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Background: Socioeconomic status (SES) is a key determinant of health. However, ascertaining the SES in developing countries is really challenging. Hence, we decided to develop an asset-based simple and rational SES tool for urban population of Puducherry and compare it with Modified Kuppuswamy's (MK) scale. Materials and Methods: Sequential mixed methods design was used. The list of local household assets to determine SES was created based on group interviews with stakeholders and review of literature. Then, survey was carried out among 500 urban households by trained medical interns after obtaining informed consent. EpiCollect-5, mobile-based software, was used to capture data. Principal component analysis (PCA) was carried out to construct a wealth index using SPSS version 24. The assets included in the final PCA were ranked based on their contribution to the index by linear regression. Results: The eigenvalue for the first principal component was 6.7 accounting for 33.6% of the variance in the original data. Finally, reduced 10-item-based SES scale was created and scoring system was formulated based on regression coefficient. The weighted kappa statistics and correlation coefficient measure of reliability between household quintiles on 20-item and 10-item reduced SES tool were 0.77 and 0.95, respectively. There was a moderate correlation between SES obtained from MK scale and newly constructed scale. Conclusions: The newly devised SES scale is context specific, reliable, easy to administer, and quick to ascertain the SES and thus can be used for a similar context in future health research. [ABSTRACT FROM AUTHOR]