According to the Census of India 2001, urban areas are those which satisfy the conditions given below.

(a) All places with municipality, corporation, cantonment board or notified town area committee etc.

(b) All order places which satisfy the following criteria:

(i) A minimum population of 5000.

(ii) At least 75% of male working population is engaged in the non-agricultural sector.

(iii) A density of population of at least 4000 persons per square km.

The procedure adopted for functional classification in 1991 census was as follows:

(i) For each urban agglomeration/town the percentage of total main workers in each of the five sectors (primary, Industry, Trade, Transport, Services) was worked out.

(ii) The functional category of the UA/town was then determined on the following basis:

(a) If workers in one sector constituted 40% or more than UA/towns were classified in the relevant mono functional category.

(b) If the percentage in one sector less than 40%, two sectors having the largest percentage were combined to see if they together constituted 60% or more. If seen, the U.A/town was classified in the relevant functional category.

(c) If no two sectors added up to 60% or more, three sectors having the largest percentage were combined and the U.A/town was classified in the relevant multi-functional category.

(iii) To determine the functional category of each U.A/town, in certain cages where at least 1/4th workers were engaged in one of the four activities viz:

(a) Forestry/fishing.

(b) Mining and quarrying.

(c) Manufacturing industry.

(d) Construction.