The Kathmandu Valley of Nepal epitomizes the growing urbanization trend spreading across the Himalayan foothills. This metropolitan valley has experienced a significant transformation of its landscapes in the last four decades resulting in substantial land use and land cover (LULC) change; however, no major systematic analysis of the urbanization trend and LULC has been conducted on this valley since 2000. When considering the importance of using LULC change as a window to study the broader changes in socio-ecological systems of this valley, our study first detected LULC change trajectories of this valley using four Landsat images of the year 1989, 1999, 2009, and 2016, and then analyzed the detected change in the light of a set of proximate causes and factors driving those changes. A pixel-based hybrid classification (unsupervised followed by supervised) approach was employed to classify these images into five LULC categories and analyze the LULC trajectories detected from them. Our results show that urban area expanded up to 412% in last three decades and the most of this expansion occurred with the conversions of 31% agricultural land. The majority of the urban expansion happened during 1989–2009, and it is still growing along the major roads in a concentric pattern, significantly altering the cityscape of the valley. The centrality feature of Kathmandu valley and the massive surge in rural-to-urban migration are identified as the primary proximate causes of the fast expansion of built-up areas and rapid conversions of agricultural areas.