Cellular network is comprised of several base stations which serve cellular shaped service area and each base station (BS) is connected to the mobile switching center (MSC). In this paper, the configuration modeling and algorithm of a cellular mobile network with the aim of minimizing the overall cost of operation (handover) and network installation cost (cabling cost and installing cost of mobile switching center) are considered. Handover and cabling cost is one of the key considerations in designing cellular telecommunication networks. For real-world applications, this configuration study covers in an integrated framework for two major decisions: locating MSC and assigning BS to MSC. The problem is expressed in an integer programming model and a heuristic algorithm based on Lagrangian relaxation is proposed to resolve the problem. Searching for the optimum solution through exact algorithm to this problem appears to be unrealistic considering the large scale nature and NP-Completeness of the problem. The suggested algorithm computes both the bound for the objective value of the problem and the feasible solution for the problem. A Lagrangian heuristics is developed to find the feasible solution. Numerical tests are performed for the effectiveness and efficiency of the proposed heuristic algorithm. Computational experiments show that the performance of the proposed heuristics is satisfactory in the quality of the generated solution.