Intelligent Transportation System (ITS) is unquestionably a crucial component of transportation to mitigate the detrimental impacts of traffic congestion. However, despite their tremendous possibilities, ITS cannot be fully beneficial unless it can do so in a sustainable, scalable way and generate support from the public. This literature review evaluated recent studies about the existing principles of traffic management, the development of ITS, and the new generation of ITS for sustainable transportation. This study figured that most of the research is looking towards automated devices that would reduce the effort of drivers and automatically run a self-drive vehicle. It was found that the reality behind vehicular communications requires further and more combined efforts and entails significant public sector investments and engagement from private enterprises. The study determined that ITS cost implications have been neglected in most recent ITS publications. It would generally be more attractive to the public sector to engage in the ITS framework if prompt execution could generate income that could benefit developing countries. Advocating to use the system necessitates solving ITS issues to guarantee that systems are safe, efficient, cost-effective, and user-friendly. It also entails collaboration among governments, businesses, and academic institutions to foster innovation, develop suitable regulations, and implement scalable solutions that might enhance the transportation system.