Shiraz district in south of Iran is a classical focus of Cutaneous leishmaniasis (CL) and previous research has consistently documented the etiologic agent to be Leishmania tropica and Leishmania major in urban and rural areas, respectively. However, none of the Phlebotomus sergenti, a known vector for L. tropica, of the region has been found infected. We report the first isolation of L. tropica from sandflies in urban community of southern part of Shiraz city. Parasite polymerase chain reaction (PCR) followed by restriction fragment length polymorphism (RFLP) and gene sequencing analyses indicate CL cases in this community were caused by either L. major or L. tropica. Sandflies of P. sergenti were infrequent, however, three out of 10 (30.0%) females captured in urban area were found infected with L. tropica. But, no human cases were found to be infected with L. tropica. Phlebotomus papatasi were found the most dominant and infected species where 41 out of 207 (20%) tested individuals harboring L. major in suburb area of the city. Patients have been lived in the suburb area of the city where people keep normally domestic animals in their houses which provide appropriate environment for completion of sandfly life cycle and expansion of CL disease in the region.