System-on-a-package (SOP) or multi-domain module (MDM), next generation multichip module (MCM) philosophy, offers significant performance promises, and new set of packaging and integration challenges. In packaging and integrating SOP, the drive is not only to increase electrical density, increase operating speed and reduce cost per part but also the major advantage is to make system SMART by increasing functional density per unit area and/or per unit volume. Functional spectrum not only includes electrical domain with elements such as control, processing, memory, etc. but also, various other domains or signals such as mechanical, optical, chemical, magnetic, biological for sensing and/or for actuation. MEMS and related microsystems are used for various mechanical, optical, chemical and biological sensing and actuation, and are the important elements of SOPs. This paper discusses packaging and integration advantages and challenges of MEMS and related microsystems for SOP. Philosophical difference in packaging IC versus MEMS is that IC really never wants to "touch" media where MEMS and related systems are designed to integrate with media for sensing jnd actuation. Various MEMS and micro-systems packaging related issues are dicing, handling, wafer-level packaging, media compatibility, outgassing and vacuum packaging, interconnection, etc. This paper will discuss SOP related MEMS and microsystem packaging and integration issues.