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Synopsis The present study investigates into the nature of interrelations between the process of urbanisation and economic development in the state of Punjab and Orissa representing two extremes with regard to level of economic development. Covering a period of three decades from 1961 to 1991, the study is based on districtwise data drawn from varied sources. Along with a detailed account of the spatial pattern of the urban processes and regional economic structure, the study attempts to identify the salient spatial correlates of the urbanisation process in the two states separately. The emergence of new towns and spatial distribution of slow and fast growing urban centres have also been analysed. Besides, a townwise analysis of urban growth and its correlates with socio-physical infrastructural facilities including urban finance, has also been attempted in the study.