Public transport systems, both rail and road, have over previous years developed relatively independent of each other and in competition with the private car. In recent years the changes in demand for public transport due to increase in car ownership, changes in land use and wider economic forces have highlighted the importance of integrating existing networks as an alternative to mass development of new transport systems. At the same time, citizens are becoming more demanding. This multi-faceted challenge can only be addressed by adopting an integrated approach to mobility issues with the support of all protagonists. This approach must be based on twin foundations: on the one hand, the coordination of urban policies with journey policies, and, on the other hand, modal integration between transport networks. The integration of different modes including non-motorised transport (NMT) with public transport services is essential for sustainable development and is a real challenge for transport planners. In view of the above the overall concepts of system integration, issues related to integration of NMT services with public transport modes, more effective operations of demand responsive transport (DRT) over conventional bus services in the present scenario, improvement of network characteristics due to integration of modes, etc. have been discussed in this paper. Various policies, issues, challenges and problems to be faced for integrated urban mass transportation system planning towards sustainable development are presented in this paper.