Synchronized phasor measurement units (PMUs) are replacing conventional measuring meters in modern power networks. The paradigm of grid monitoring has shifted to a wider area. This offers better monitoring, protection, and control of the overall power grid. This paper presents an approach for optimal placing of PMUs in constrained power grids using the binary integer programming technique. The proposed approach deals with four constraints: 1) observability of network, two cases of fully observable and partially observable networks are investigated; 2) conventional measurements, three cases of zero injection bus and injection measurement, conventional power flow measurement, and both injection and power flow measurement are considered; 3) failure of a single PMU or communication line; and 4) rate of failure of PMUs or communication line, two cases of low and high are considered. The proposed approach is tested on an IEEE 14-bus system, a 21-bus 400-kV real power system, and an IEEE 30-bus system. This study will help the power system planner to design an economical, efficient, and reliable monitoring system.