Khartoum is an example of a city where the land is controlled and allocated by the State. The land is allocated for housing and different urban activities through a specific process and procedures under specific rules, laws and institutional structure and policies. The paper discusses these issues to explore how sustainable the system is and how effective is the allocation process. Having a large number of interfering factors inherent in the urban land allocation, the paper discusses the rationality of the process and how it could be appraised. Adopting a deductive research method the article portrayed the complex nature of the system and highlighted the need for more sustainable and rational methods of allocation that can enhance appropriate urban land development.