Many features characteristic of the Indus civilization were known by the Early Harappan period in some towns: cardinally orientated streets, baked bricks, substantial walls, skilled and partially specialized craftsmanship, and the rudimentary use of signs to indicate ownership or for administrative purposes. In addition to villages and pastoral camps, there were a number of towns, probably providing goods, services, and organization for the villages in their area. But their influence did not extend far, and regional styles of pottery and other artifacts indicate the existence of a number of different groups and traditions. These interacted with each other and with neighboring cultures in India, Kashmir, and the Iranian plateau. Over a few generations, the majority of settlements were destroyed or abandoned or rebuilt on a greatly expanded scale and to a grander plan, with wide streets, brick drains and wells, and substantial surrounding walls, and the number of settlements increased enormously, most of them being new foundations. In addition to camps, villages, and towns, there were now cities. Urban settlements housed artisans in a widened range of crafts, often practicing more specialized craft skills and engaging full-time in these activities. The simple seals and potters' marks had developed into a writing system, used on seals that were widespread. Regional artifact styles had been largely superseded by uniform and high-quality products throughout the Indus basin, reflecting cultural and possibly political unity. Overland interactions with neighboring cultures increased in some directions, with integrated trade and procurement networks, which were added to and in some areas replaced by overseas trade to Oman and other lands bordering the Gulf.
An understanding of how and why these changes took place is still elusive. The evidence of fiery destruction at many sites has been interpreted by some scholars as the reflection of warfare, although there is no other evidence to support this, such as weaponry among the artifact assemblage. Evidence of violent death might be sought among funerary remains but these are too limited to be helpful.
An alternative explanation is that the deliberate destruction of old settlements and the creation of new ones following certain principles, such as the cardinal orientation of streets and the emphasis on water supply and sanitation, reflect the widespread adoption of a new ideology, which was to underlie the unity and considerable uniformity of the Indus civilization. In this scenario, rather than reflecting enemy action, the destruction by fire of the settlements was an act of ritual or ideological purification. Indeed some scholars suggest that the Indus civilization was not a single state but a collection of smaller independent polities unified by this shared ideology, a hypothesis that has its attractions.
While the widespread rebuilding and relocation of settlements are peculiarities of the Indus Basin, many of the other developments, such as craft specialization, the implied emergence of a social hierarchy, and writing, are features that generally characterize the civilizations that emerged in various parts of the world from the late fourth millennium onward. These features reflect the growth of urban societies based on the production of an agricultural surplus and involved in trade and internal distribution networks to obtain and circulate essential and luxury goods, some of which were emblems of power for the emerging elite or symbols of prestige for the urban centers and their gods.
The stimuli behind the transformation of the cultures of the Indus Basin into an integrated urban civilization are still as much the subject for debate and speculation as they were when the civilization was first discovered.