Precise and appropriate traffic related data allows travellers to choose suitable travelling modes, travelling paths, and departure time, which is crucial for the success of Intelligent Transportation System (ITS). With the growth of vehicles, the rate of pollution and consumption of fuel has increased, it also creates traffic congestions. For the recent years there has been a rapid growth in technology, which can be explored to solve traffic issues. However, depending upon the available technologies each countries ITS research area may be different. The objective of this literature review is to integrate ITS with internet of things and it also discusses the prospect of clustering, controller system, location identification and resource privacy in ITS.