Abstract: South Pars Special Zone has played a significant role in Iran’s economic growth since 1998. The rapid development of this region and government’s extreme desire to exploit the gas field shared between Iran and Qatar has led to an unusually rapid urban expansion in the city of Assalouyeh. The objective of this study is to evaluate the impacts of industrial expansion in South Pars Special Zone on surrounding cities and villages, which was pursued by descriptive-analytical method, based on library and field study and data gathered from questionnaires completed by residents. The population of this study comprised of families living in the city of Assalouyeh in 2011, among which 315 were interviewed based on Cochran formula. The time period under study was 1956-2011. Results showed that the effects of industrialization on urban expansion in Assalouyeh are reflected in the form of seven major factors which are as follows: The creation of spatial limitations for the future development of Assalouyeh, the formation of new urban fabrics on agricultural lands, the disruption of development and implementation of comprehensive plan, the diversion and change in the function of streets and urban roads, the creation of urban sprawl, the improvement of infrastructures and amenities and the ecological invasion and replacement.