The major two steps required to design a cellular layout are cell formation and cell layout. Because of the differences between manufacturing and assembly operations, the logic of cell formation and cell layout between an FMS and an FAS is not the same. Since the time for the assembly operations is usualaly relatively short, the transfer time is thus very crucial for the performance of assembly systems. Transfore in a cellular FAS it is more important to eliminate backtracking operations in assembly planning, not to allow intercellular movements in cell formation, and to arrange machines according to assembly sequence in cell layout. This study presents a method for the integrated layout design in cellular FASs considering the characteristics of FAS, layout, and production factors.