  The $K\to\pi\pi$ decay amplitudes are studied within the framework of
generalized factorization in which the effective Wilson coefficients are
gauge-invariant, renormalization-scale and -scheme independent while
factorization is applied to the tree-level hadronic matrix elements.
Nonfactorized contributions to the hadronic matrix elements of (V-A)(V-A)
four-quark operators, which are needed to account for the suppression of the
$\Delta I=3/2 K\to\pi\pi$ amplitude $A_2$ and the enhancement of the $\Delta
I=1/2 A_0$ amplitude, are phenomenologically extracted from the measured
$K^+\to\pi^+\pi^0$ decay and found to be large. The $A_0/A_2$ ratio is
predicted to lie in the range 15-17 for $m_s(1 GeV)=(127-150)$ MeV. Vertex and
penguin-type radiative corrections to the matrix elements of four-quark
operators and nonfactorized effects due to soft-gluon exchange account for the
bulk of the $\Delta I=1/2$ rule. Comparison of the present analysis with the
chiral-loop approach is given.
