Urbanisation has become a powerful force in developing countries and is a development which has taken place quickly and comparatively recently in Asia, Africa and Latin America. However, a review funded by the Ford Foundation, concluded that this phenomenon of urban growth has not been recognised adequately in research and policy, or in the development programmes of international assistance agencies. Certain themes can be detected in emerging research on urbanisation: the environment and sustainability; poverty; finance and the economy of cities; urban social structure; globalisation; and urban governance. The latter has been identified as crucial to the management of Third World cities and can be defined as the relationship between municipal/city authorities and citizens. The importance of governance at a city level is reflected in the conditionality of 'good governance’ imposed by most donor agencies including the UK Overseas Development Administration. But what does governance mean at the city level? How is current research analysing governance? What is emerging from research on urban governance in order to identify indicators of good governance that can eventually be incorporated into a method to analyse urban governance in any Third World city? This review is descriptive, and deeper knowledge of the relationship between municipal authorities and citizens will be obtained only through in-depth observation and interviews. However, with growing discussion about urban governance this first step of clarifying definitions and dimensions of urban governance is vital.