A research associated with urban transportation was carried out in Rawalpindi and Islamabad to analyze the status of emission of air pollutants and energy demands. The study included a discussion of past trends and future scenarios in order to reduce the future emissions. A simple model of passenger transport has been developed using computer based software called Long-Range Energy Alternatives Planning System (LEAP). The LEAP model was used to estimate total energy demand and the vehicular emissions for the base year 2000 and extrapolated till 2030 for the future predictions. Transport database in Rawalpindi and Islamabad, together with fuel consumption values for the vehicle types and emission factors of NOx, SO2 and PM10 corresponding to the actual vehicle types, formed the basis of the transport demand, energy consumption and total emission calculations. Apart from base scenario, the model was run under three alternative scenarios to study the impact of different urban transport policy initiatives that would reduce energy demand and emissions in transport sector of Rawalpindi and Islamabad. The prime objective was to arrive at an optimal transport policy, which limits the future growth of fuel consumption as well as air pollution. (C) 2010 Elsevier Ltd. All rights reserved.