Renewable energy-based distributed generators (DGs) are gaining more penetration in modern grids to meet the growing demand for electrical energy. The anticipated techno-economic benefits of these eco-friendly resources require their judicious and properly sized allocation in distribution networks (DNs). The preeminent objective of this research is to determine the sizing and optimal placing of DGs in the condensed DN of a smart city. The placing and sizing problem is modeled as an optimization problem to reduce the distribution loss without violating the technical constraints. The formulated model is solved for a radial distribution system with a non-uniformly distributed load utilizing the selective particle swarm optimization (SPSO) algorithm. The intended technique decreases the power loss and perfects the voltage profile at the system’s nodes. MATLAB is used for the simulation, and the obtained results are also validated by the Electrical Transient Analysis Program (ETAP). Results show that placing optimally sized DGs at optimal system nodes offers a considerable decline in power loss with an improved voltage profile at the network’s nodes. Distribution system operators can utilize the proposed technique to realize the reliable operation of overloaded urban networks.