1 ABSTRACT Lagos represents one of the cities with the fastest growing urban agglomerations in the world. Rapid urbanisation coupled with inadequate public resource has given rise to peculiar land development system that is, informal land use. It has been observed that formal land management system has continuously failed in providing land for housing and other uses, registering titles and land transfers, regulating access to and use of land as well as providing basic infrastructure services. The shortage of the formal system has, however, been largely compensated by the increasing importance of an informal system in land development. This paper addresses the main issues and challenges of informal land use in Lagos State and how it can be integrated into urban development so as to achieve a sustainable, healthy and livable urban settlement. Major issues and challenges confronting informal land use as identified by the paper include uncontrolled and conflicting land use, Unplanned growth, illegal squatting, overcrowding, inadequate or lack of basic services and infrastructure, continuous rise in incidence of informal land use, insecurity of tenure, poverty and worsening environmental conditions, marginality, exclusion and vulnerability among others. Therefore, it is imperative to confront the incidence of informal land use through the use of adequate and sustainable means of land use management system, informal land regularization that guarantees security of tenure, urban growth and housing strategy to address shortage of affordable and adequate serviced housing, massive provision of basic services and infrastructure and improved urban land administration. 2 INTRODUCTION In sub-Saharan Africa, land defines the social, economic and political relations in the society. Especially in the urban areas, it provides the basis upon which planners predicate their strategies of development (Wanjala, 2002). However, It has been observed that in many third world cities, urban land can either be obtained formally or informally, and that the informal sector provides much more land to land seekers (including the majority of the poor) than the formal sector. Nevertheless, the mechanisms of the informal land sector are usually ignored and are hardly understood and documented. (Mabogunje, 1990). The informal sector encompasses a wide range of areas of informality — environmental, spatial, economic, and social, covering business activities, employment, markets, settlements, and neighborhoods. Most urban households in the developing world live in informal settlements due to their often exclusion from formal systems of land management. Up to 85 percent of new housing is produced informally, a trend that is especially pronounced in sub-Saharan Africa and particularly in Nigeria (Nkurunziza, 2007).