The problems and tendencies of development of large industrial cities of Russia with the specialization in the sphere of iron and steel industry are analyzed in the paper. The thesis that large industrial cities under modern circumstances are becoming the cores of rapidly developed regional systems of economy and displacement concentrating on its territory both the main part of productive assets of key industries of national economy, and considerable masses of population is logically developed. Expanded comparative evaluation of economic and social situation of such cities is carried out. By virtue of its results there has been made the conclusion that the cities which are the centers of iron and steel industry are still marked by delay in quality of life indicators and the level of development of economy industries, oriented on the satisfying of needs of the city and surrounding grounds population. The trends of key economic indicators of major iron and steel plants, shaping town-forming complex of the cities are analyzed. It is underlined that for the most complete evaluation of town-forming enterprises influence on the urban economy it is necessary to take into consideration the process of vertical integration. Methodical aspects of town-forming enterprises influence evaluation on the economy of large cities are defined more precisely. The necessity of accounting of direct as well as indirect forms of town-forming enterprises influence on the urban economy is proved. Mechanisms and conditions, encouraging diversification of functional specialization of a large industrial city under the circumstances of economic growth are observed in detail. It is underlined that the most favorable for the city is locating on its territory of the main production center and the center of decision- making of vertically-integrated holding. Finally, perspective trends of development of large industrial Russian cities which are the centers of iron and steel industry are formulated.