The rural and (urban) municipalities lie within seven new States (provinces). Heavily urban areas are defined as metropolitan or sub-metropolitan cities – the latter having a minimum population of 150,000. (Urban) municipalities are required to have a minimum population of 60,000 in the low-lying Terai plains, 31,000 in the hills and 17,000 in the mountains. However, the division between rural municipalities and (urban) municipalities is not always a straightforward one between country and town; many are a mix of rural and urban areas.

In Bolivia, a settlement must have a population of over 2,000 to be classified as a town. Just under 1.3 million, or approximately 20 per cent of the total population, live in small and medium-sized towns with a population between 10,000 and 100,000. These small towns fall into two categories: small cities that are located close to bigger cities such as La Paz and Cochabamba and are growing to create a larger suburban, metropolitan area and those smaller cities that are more remote and tend to grow outwards through low-density extensions.