This study is an early-bird attempt to probe the reasons behind Cash Holding among Indian urban local bodies (ULBs). The risk of uncertainty, volatility in cash flows, and dynamic economic conditions insist on the management of ULBs viewing cash as a strategic tool for situation management and scenario planning. This paper explores the reasons for Cash Holdings by analyzing 38 Indian municipal corporation’s data over 5 years. The study results revealed the Existence of a high degree of inverse relationship between municipal Cash Holdings and aspects such as Growth, Size, State Revenue, Capital Expenditure, and Debt Per Capita. In contrast, Administrative Expenses and Tax Revenue positively correlated with municipal Cash Holdings. The study results empirically identified the variables, namely Size, Administrative Expense, State Revenue, and Debt Per Capita, as the primary reasons for holding cash by Indian municipal corporations and pointed out the Existence of differences among different categories of municipal corporations in India.