Recently, railway traffic has increased considerably in the different parts of the world; moreover,rnit is expected that railway transportation will further grow for both passenger and freightrntransportation. These developments create needs to optimize both the utilization of therninfrastructure and the coordination tasks inside the railway company. rnInvestments in railway infrastructure are expensive and already constructed railwayrninfrastructure is not easily adjusted or changed. Dimensioning and constructing railway lines andrnnetworks therefore require extensive knowledge of future operation and demand. As thernexperience shows that the traffic often develops differently than expected. This means thatrnrailway infrastructure has to be designed flexibility, for different operational conditions. rnrnThere are many approaches that are used to model and implement the evaluation of railwayrncapacity. In this thesis reviewing previous relevant literature and available data, analyticalrnmethod UIC 405 is being used. This method tries to calculate the theoretical capacity in order tornevaluate the railway line capacity and from that practical capacity has been determined. rnFirst step for railway planning is to determine the demand passenger. To analyze the passengerrndemand and the number of train needed, a modal split is used to forecast the demand. Therndeveloped models are applicable to passengers railway network like Addis Ababa LRT.rnrnBased on the different analysis made for both on North-South and East-West LRT route, thernresults show that 34 trains has to be operate for both routes which can respond and satisfy thernpassenger demand for the current year. Thus the Ethiopian Railway Corporation (ERC) to revisernthe railway planning by considering the growth population and increase the number of trains.