In this paper the authors survey layout issues in the flexible manufacturing system (FMS) environment. The FMS layout problem deals with the allocation of M stations to M (or more) candidate locations in order to satisfy the throughput requirements of the system. The relevance of quadratic assignment problem (QAP) formulations for the problem is examined. Results from the recent research literature are reported, and many different approaches to the problem are discussed. Emphasis is given on graph theoretic modelling techniques, heuristic approaches for special FMS layout types, and the queueing and dynamic aspects of the layout decisions. Operational and other design issues interacting with layout decisions are also surveyed, and relevant research literature is reported. Promising research directions and interesting open problems for FMS layout researchers are clearly described.