In 1996, the Department of Architecture and Urban Planning at IOE launched the MSc. in Urban Planning Program with the goal of developing academically and technically sound, practice-oriented human resources in the field of urban development and planning. The course covered the theoretical underpinnings of urban planning, such as planning as a theory, planning as a technique, and planning as a decision-making process. It sought to generate a much-needed body of knowledge in the field of urban planning through research in the field of urban planning, ranging from urban development concerns based on planning studio to planning problem-based thesis.

Since its commencement, the program has produced over 350 professional urban planners who work in Nepal's public, private, and development sectors in responsible and highly recognized positions in the field of urban planning and development. A significant number of urban planning graduates have gone on to pursue careers in academia and higher education. Despite being a popular curriculum with significant job demand, the course had not been updated since its inception in 1996 due to resource limits and other technical issues.