Cities and towns in Nepal are incorporated under municipality.

The Government of Nepal has set-out a minimum criteria for municipalities.

Other than that there are 460 rural municipalities totaling 753 local level government within Nepal.

[5] Along with other major criteria as mentioned in Local Governance Act 2017 of Nepal, the number of population to be considered as the municipality: the minimum population in mountainous district should be 10,000 while hilly districts, inner terai districts, terai districts, and Kathmandu valley should include forty thousand, fifty thousand, seventy thousand and one hundred thousand respectively.

Classification: The Ministry of Federal Affairs and General Administration has classified the local units into four grades based on infrastructure and social development.