Pakistan is one of the prone country to manmade and natural disasters. Since 9/11 Pakistan experiences a number of civil conflicts in terms of militancy, terrorists interventions, radicalization of youth and many other local sectarian conflicts. FATA and larger part of the Khyber Pakhtunkhwa were directly and indirectly under the militants’ control. FATA areas are under tremendous pressure due to conflict between militant and the government of Pakistan security forces. The government of Pakistan has carried out military operations against the militants since 2009 in name of the Rahi Rast, ZarbAzab, and Radul Fasad, which is still continue in the whole country. The military operation in Swat in 2009 followed by operation in 2011-12 in South Waziristanwas, Khyber and Orakzai agencies and the last one in North Waziristan. These military operations have caused internal displacement of the huge population which have had highly affected the social, economic and physical structure and development processes of the whole province (Salman, 2012). In 2010, a heavy flood disaster hit the whole Pakistan which, have further deteriorated the security situation and livelihoods of the local population. Since then the post conflict and flood disasters development initiatives in the form of relief, rehabilitation, resettlement of the internally displacement people (IDPs) and reconstruction are in progress. A number of government institutions including Pak Army, NDMA, PDMA, PaRRSA and over 100 national and international organizations are involved and supporting the post conflict development processes to maintain peace, security and provide basic livelihoods to the marginalized and affected papulation. A huge amount in term of Aid was promised by Friends of Pakistan and Nongovernmental organizations for development of the affected areas. This research project focuses on how the development aid has contributed to the peace, security, de-radicalization, and development of the communities. The study analyses the challenges the institutions face in the implementation of post conflict development interventions and the opportunities for sustainable peace and development. The study is based on both qualitative and quantitative research design and will employee semi structured interviews, focused group discussion and participant observation for collection of primary and secondary data throughout the Khyber Pakhtunkhwa and FATA areas. The study will contribute to the wider post conflict theoretical aid and development perspectives. The findings and results in terms of identifying constraints in effective utilization of development aid, challenges in livelihood interventions and attaining the peace and development objectives on sustainable basis may be recommended for replication and adaptation in other conflict affected societies at national and regional level.