The Kathmandu Valley is a bowl-shaped intermontane basin, which occupies an area of 583 km 2 in the heart of the Himalayas, with its floor at ca. 1400 m and the surrounding mountains attaining a height of 2000 -2800 m. It is inhabited by ca. 1.5 million people, concentrated mostly in three cities, Kathmandu, Patan and Bhaktapur. Due to rapid but uncontrolled urbanization and factors such as traffic movement, emissions from brick-kilns, cement factory, other industrial activities, waste disposal and biomass burning, environmental pollution has been constantly increasing adversely affecting land, water, air and biological systems.In order to quantify the degree of environmental pollution using magnetic methods, magnetic susceptibility of soils, sediments and roadside material, in and outside the Kathmandu urban areas, has been measured. In areas far from roads or industry, median susceptibility is (3 -35) x 10 -5 SI which is similar to that observed in the valley-filling clastic sediments being consistent with geologic or pedogenic origin. In traverses across roads, a 5-m wide zone situated at either sides of the asphalt-paved road exhibits a susceptibility enhancement zone with maximum susceptibility of 240 -850 x 10 -5 SI occurring 0.5 -2.5 m from the road edge. In urban recreational areas, it varies within a broad range (3 to >100 x 10 -5 SI) with the lowest values occurring about 50 m from any surrounding roads in areas least disturbed by human activity. A systematic increase in susceptibility towards the roads or industrial sites is observed. Within urban areas, in the 2 vicinity of heavy traffic or industrial sites, the upper 30 -50 cm of soil profiles exhibit frequent enhancement in susceptibility, of one or two orders of magnitude higher than those expected from geologic input. Such enhancements are attributed to input from anthropogenic or industrial sources. Magneto-mineralogical analyses and scanning electron microscopy on magnetic extracts, grain size fractions or bulk samples of road dust and soils suggest lithogenic magnetite-like minerals and anthropogenic magnetic spherules to be the dominant contributors to the susceptibility signal.As the soils, sediments and roadside material exhibit significant susceptibility contrasts, which are most effective in identifying traffic-related pollution "hotspots", it is highly desirable that the potential of susceptibility maps of the entire area affected by urbanization, be fully explored to assess the status of environmental degradation.