Urban development especially planned urban development is a recent phenomena inrnthe history of urban development in the Ethiopian context in general and particularlyrnin Addis Ababa. Various attempts were made to guide the development of AddisrnAbaba in a planned manner. Starting from the more traditional city organization ofrnEmpress 'Taitu', implementation of portions of the other successive Master Plansrnhave contributed their share for the birth of the present urban form of Addis Ababa.rnThe preparation and implementation of Local development plans has become a veryrnvisible phenomenon as a means to implement the Master Plans of Addis Ababarnsince the 1986 MP. Since then various LDPs have been prepared and implemented.rnAs described in the introductory part the purpose of this thesis is to conduct arnresearch on the two main areas concerning the LDPs of Addis Ababa, namely, thernchallenges and the impacts of implementing LDPs in Addis Ababa.rnIn trying to answer the posed research questions an effort was made to make thernresearch as comprehensive as possible. Hence, possible areas that are linked tornLDP implementation such as plan preparation trends, institutional and legal setup forrnLDP preparation and implementation and the socio -economic impacts ofrnimplementing LDPs in Addis Ababa are touched upon in a fairly detailed manner. Inrnthe case study section, the case of kaza-INCHIS / ECA LDP is researched to show tornthe reader the impact and the challenges of LDP implementation in the inner-cityrnareas of Addis Ababa.rnIn the final analysis the research has concluded that the introduction of LDPs hasrnbrought about a positive change in creating planned urban development in spite ofrnthe problems created in the process of implementing the LDPs in both the physicalrnand socio-economic arenas. Problems are seen in the area of the nature of the plansrnprepared in that the plans are only two dimensionally conceived, prepared andrnimplemented and that the three dimensional aspect of them is left to grow by chance.rnSocio-economically it was found out that implementing LDPs in the inner-city areas ofrnAddis Ababa such as the ECA LDP has caused the disruption of the socio-economic