A model of the urban system in the new era of information technology is developed by the introduction of new concepts and new variables to location theory. By use of the model one can generate different urban configurations and can bring differentiation to different locations, as opposed to traditional models which cannot explain the spatial structure of the contemporary urban system. It is shown that as concentrations get economically disadvantaged by congestion, information technology will facilitate a dispersal to the fringe and to rural areas.
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