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In this paper we use the case of Nepal to advance political geographic analyses of how, during moments of rupture, territory act as an important political technology in state restructuring, and how urban demarcation along with other territorial structures of the state will play a significant role in this process. Nepal has experienced more than three decades of state-restructuring characterized by consecutive political and constitutional crises, including close to ten years of violent conflict. Within the brief period between 2014 and 2017, more than 230 new municipalities were demarcated on top of the existing 58. In our analysis we unpack why and how the number of municipalities is quadrupled at that particular moment of time and how this is shaped by and have implications for re-configurations of Nepal's territorial structures. This is achieved through a historical analysis of how the state's politico-administrative system has been mapped, reasoned and challenged. The analysis is based on official documents, such as census data and reports, legislative acts, public debates and academic analyses of processes of administrative and political reforms and conflicts in Nepal since the early 1990s. It therefore engages with a rich literature on conflict, the post-conflict situation and the restructuring of the state. Based on our findings we argue that urban demarcation is an important part of a states' political technology complex, and warn against trends in studies of urbanization to question the analytical bearing of differentiating the rural and urban. Showing that Nepal's recent urban boundaries have been justified by the need to achieve a better geographical balance, we conclude by arguing for the need for studies of urban transformations that critically examine whether and how the new territorial structures in their implementation contribute to balance geographical and social inequalities. [ABSTRACT FROM AUTHOR]