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Peshawar is increasingly transforming into a city of congestion and traffic related problems due to growing number of vehicles coupled with lack of expansion in the existing road network and effective traffic management. This paper is aimed to study the status of growing traffic, its main causes and effects, road network analysis vis-à-vis the prevalent traffic management in the city. For this purpose relevant secondary data was collected from Excise and Registration Department, Peshawar; Communication and Works Department, Peshawar; National Highway Authority, Peshawar; Bureau of Statistics, Peshawar; Highways Department Peshawar; Peshawar Development Authority and Headquarter Traffic Police, Peshawar. Information was also collected through questionnaires survey and interviews with drivers, general commuters and personal observation. The findings reveal that during 1998-2009, the proportion of increase in number of vehicles is 126.4 % while that of road network expansion is only 0.85 %. The data shows that major contribution to increasing number of vehicles is private cars, which constitute 75.35 % of the total registered vehicles and has shown 228.98 % increase during 1998-2009. Besides, the greater number of road-blockages and check posts created by the security personnel in the wake of terrorism threats is another cause of traffic jams in the city. Furthermore, the situation has caused extra fuel consumptions and delays. The paper suggests effective traffic management and awareness; planning and development control with measures to discourage the use of private cars in the city.