Abstract In spite of many policy interventions and proactive legislations by the Central Government aimed at encouraging Urban Local Bodies (ULB) to play an active role in promoting orderly growth of the Micro Enterprise Sector in India, the ground reality is that most ULBs have not accepted the new mandate. Even though the sector is important contributor to the economy, particularly towards the growth of employment, there is little focus on the wellbeing of the sector by the ULBs which are responsible for the regulation and growth of the sector. The law requires that all micro enterprises-shops, establishments, and hawkers need to register themselves with the local government. The intent of the law is that the ULBs can plan for an orderly growth of the sector as well as regulate the sector. However, it is universally accepted that there is virtually no compliance of the law.