The article considers the initiative budgeting of Ural cities as one of the mechanisms of sustainable development of territories with the participation of citizens. Mountainous areas have a range of geographical, climatic, infrastructural and other features, which determined the process of legitimizing initiative budgeting in such areas. The purpose of the study is to analyze the implementation of the practices of initiative budgeting in the mountainous regions of the Perm Region as a mechanism of socio-economic initiative of citizens in the sustainable development of the cities of the Urals. To achieve the purpose of the study, the following methods were used: system analysis, collection and analysis of scientific literature, regulatory legal documentation and reports of the Ministry of Territorial Development of the Perm Region. The methodology of competitive selection of initiative budgeting projects and determination of the volume and sources of financing for the implementation of projects is presented. The directions for improving the implementation of the practices of initiative budgeting for the sustainable development of the territory of mountainous areas have been identified. As a result of testing the methodology, up-to-date statistics were obtained on the volume of regional financing of initiative budgeting projects and on the number of projects submitted to the regional competition that affect the sustainable development of these territories. For the development of initiative, budgeting, built-in financing mechanisms are needed. The research results can be useful in organizing organizational forms of support for initiative budgeting at the level of cities and regions with similar specifics of development.