Kabul, the capital city of Afghanistan is the fifth fastest growing city in the world, whose population has increased fourfold since 2001 from 1.2 million to 4.8 million people. The main reason of this increment is identified as the return of Afghans migrated during the civil war. In addition to the return of immigrants, a steep economic growth due to the foreign assistance in the last decade creating lots of job opportunities in Kabul resulted in attraction of individuals from the neighboring provinces as well. However, the development of urban facilities such as water supply system, housing transportation and waste management systems has not yet to catch up to this rapid increase in population. Kabul city has developed traditionally and municipal governance had very limited capacity to implement municipal bylaws. As an unwanted consequence of this growth 70% of Kabul citizens contributed to developing informal settlement. Around three million people living in informal settled areas, lacking the very vital social and physical infrastructures of livelihood. This research focuses on a region with 24 ha area and 4436 residents in the center of Kabul city. A comprehensive land readjustment concept plan has been formulated for this area. Through this concept plan physical and social infrastructure has been demonstrated and analyzed. Findings of this paper propose a solution for the problems of this unplanned area in Kabul which is readjusting of unplanned area by a self-supporting process. This process does not need governmental budget and can be applied by government, private sectors and landowner associations. Furthermore, by implementing the Land Readjustment process, conceptual plans can be built for unplanned areas, maximum facilities can be brought to the residents’ urban life, improving the environment for the users’ benefit, the transport system and economic status (the value of land increases due to infrastructure availability and land legalization). In addition to all these benefits for the public, we can raise the revenue of government by collecting the taxes from land owners. This process is implemented in most of countries of the world, it was implemented for the first time in Germany and after that in most cities of Japan as well, and is known as one of the effective process for infrastructural development. To sum up, the notable characteristic of the Land readjustment process is that it works on the concept of mutual interest in which both land owners and government takes advantage. Though in this process, the engagement of community is very important and without public cooperation this process can face the failure.