Since its inception as a state in 1971, Himachal Pradesh has relied heavily on horticulture and tourism to generate revenue. The government of India announced a special industrial package of incentives for setting up new industries in the state during the period 2003–14, attracting about 1074 large and medium enterprises as reported by the Industries Department, Govt. of H.P. Industrial growth took a constant decline 2013–14 onwards & continued despite the fact that the special package was renounced in 2014 with some modification (Mohd S (2017) Impact of special industrial package on the growth of Himachal Pradesh). The paper assesses the problems and prospects of industrial cities in Himachal Pradesh using secondary data sources, including online and print sources, from 1990–91 to 2020–21. During the evaluation period, medium and large-scale enterprises contributed significantly to employment and the number of industries. The challenges related to planning perspective faced by industrial towns in the state of Himachal Pradesh highlighted in the study. The problems were identified through literature review and ranked in order of significance by taking expert opinion using delphi method. Further solutions were explored through literature and suggested in the related context.