Livelihood Resilience is a distinctive capacity of people to sustain or improve their livelihood opportunities and well-being in case of any disturbance includes development. The main goal of any development project involving displacement though is to restore the livelihood of the resettlers or bringing it to their prior condition that has not been considered in the majority of development-induced displacement and resettlement projects in India. Further, a review of the literature shows studies considering the livelihood resilience in the case of urban developmentinduced rural displacement and resettlement are limited. Hence, for understanding the livelihood resilience of the households in the case of rural to urban development, the study evaluates the literature concerning the urban transformation of rural people, livelihood resilience, and sustainable livelihood approach (SLA) of the Department for International Development (DFID). The present review opens up the research gap and a future direction of research for enhancing and strengthening the livelihood resilience of the villagers, affected by urban development. It also identifies the household livelihood resilience approach (HLRA) based on SLA has the potential to help the planners in identifying specific interventions and proposing comprehensive development with minimum impact on the villagers.