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The article analyzes structural differentiation and continuity in the organization of a municipal government in the U.S. The relative importance of three factors shaping community development are considered in the paper. This includes the often neglected force of local tradition deriving from historical political cultures and early institutional forms, the growing power of the state in attempting to rescue an interdependent private economy from social injustice, and the pressure of urbanization on local government to provide more services and to splinter into the characteristic metropolitan mosaic. The analysis suggests that the nation-state, not the metropolitan community, is the final inclusive system and the appropriate unit of analysis for assessing the environmental determinants of organizational change in the urban community. The analysis also supports the inference that organizational change in functional assignment to governments varies over time by function. It has stressed on the importance of historical residues in the organization of city government.