Autonomous vehicles (AVs) are increasingly recognized for their potential to enhance urban traffic systems, particularly in traffic management and sustainability. This study explores AV integration into urban networks, focusing on transitions of control (ToC) and dedicated lane (DL) applications at varying AV penetration rates. Through simulations, various scenarios reveal the complex interactions between AVs and human-driven vehicles in mixed traffic conditions. The findings show that DLs can reduce local density, occupancy, and time loss by 5–35%, while improving travel time reliability by 15–25%. On an urban scale, DLs generally enhance traffic flow and reduce emissions, though the effects of ToC vary based on traffic conditions and AV automation levels. At lower AV penetration rates, ToC can lead to increased travel times and up to a 10% decline in traffic performance due to unpredictable human driver behavior during control transitions. The results highlight that DLs can significantly improve traffic flow, travel time reliability, and emissions, thereby contributing to sustainable urban mobility. However, the impacts of ToC are more complex, depending on specific traffic conditions and AV automation levels. This study emphasizes the importance of well-designed ToC and DL applications to optimize AV integration and support a balanced, sustainable future for urban mobility.