Problem statement: Location knowledge in indoor environment using Indoor Positioning Systems (IPS) has become very useful and popular in recent years. A number of Location Based Services (LBS) have been developed, which are based on IPS, these LBS include asset tracking, inventory management and security based applications. Many next-generation LBS applications such as social networking, local search, advertising and geo-tagging are expected to be used in urban and indoor environments where GNSS either underperforms in terms of fix times or accuracy, or fails altogether. To develop an IPS based on Wi-Fi Received Signal Strength (RSS) using Artificial Neural Networks (ANN), which should use already available Wi-Fi infrastructure in a heterogeneous environment. Approach: This study discussed the use of ANN for IPS using RSS in an indoor wireless facility which has varying human activity, material of walls and type of Wireless Access Points (WAP), hence simulating a heterogeneous environment. The proposed system used backpropogation method with 4 input neurons, 2 output neurons and 4 hidden layers. The model was trained with three different types of training data. The accuracy assessment for each training data was performed by computing the distance error and average distance error. Results: The results of the experiments showed that using ANN with the proposed method of collecting training data, maximum accuracy of 0.7 m can be achieved, with 30% of the distance error less than 1 m and 60% of the distance error within the range of 1-2 m. Whereas maximum accuracy of 1.01 can be achieved with the commonly used method of collecting training data. The proposed model also showed 67% more accuracy as compared to a probabilistic model. Conclusion: The results indicated that ANN based IPS can provide accuracy and precision which is quite adequate for the development of indoor LBS while using the already available Wi-Fi infrastructure, also the proposed method for collecting the training data can help in addressing the noise and interference, which are one of the major factors affecting the accuracy of IPS.