From SimCity Wiki
Proper traffic management is the key to keeping a large city running. You need to start early in your mass transit plans, or you will find out that you are demolishing lots of buildings to fit in busses and subway stops after the fact. Placing effective mass transit allows more citizens to fit into a zone without abandoning due to commute time. Effective mass transit also generates more money than it costs, so it can be an effective way to balance the budget on larger cities.
It is possible to run a large city with proper transit effectively in SimCity 4 without mods, but several bugs in the algorithm SimCity 4 uses to compute commute paths will eventually lead to abandonment due to commute time and no job indicators over buildings placed right next to jobs. Therefore, it is recommended to grab the Network Addon Mod from Simtropolis, which fixes thr commute algorithms and allows you to create larger cities that properly use your transit networks.
This may seem like an unnecessary expense at the start of your city. However, if you don't plan a decent mass transit system from the start, you will be struggling later in the game to fit in mass transit stops where they are desperately needed without demolishing large sections of your city. In my cities, I try to place a transit station at the corner of every commercial and residential block, and a few scattered inside my industry. While industry will not use these directly, the workers will use them to get to their jobs, eliminating traffic in and out of your residential districts. You will find that once your city gets large, even the bus stations you have placed at every corner just doesn't cut it. Look at your traffic congestion overlay map to see where the best subway routes will be. Usually, there are veins coming or going from residential and commercial areas, and running a subway with stops along these can help.
Early on, mass transit can seem like more of a strain than anything else on your budget. You have all of these bus stops plopped everywhere, and nobody is using them, costing you hundreds of dollars a month that you could be using elsewhere. However, you are investing for the long run. On the majority of my cities, the mass transit income offsets the budget for the entire transit network (including freeways and other expensive costs). This can give you anywhere from $10,000 to $20,000 of extra income per month to work with on the average city, and is the only way you can balance the budget in some situations. Keep in mind that transit income fluctuations around $2,000 per month, so don't try to budget right to the edge of your income, or you will find that you are spending more than you are taking in some months.
One way that makes it easy to fit in mass transit for a downtown district is to zone 4x6 lots bordered on one side with avenues, and on the other side with parallel roads separated by one tyle. You can put bus stops on either side of the avenues, and fill the rest with parks. This gives the double benefit of not only providing effective mass transit with room for subways in the future, but it also raises land value and encourages skyscrapers due to the open areas with parks. It also looks quite nice.
Avenues and Highways
If you want a densely populated city, these are a must. Highways are VERY expensive, but provide excelent traffic flow from different residential, commercial and industrial districts in your city. Your major residential and commercial hubs should never be more than a few city blocks from a highway in a large city, unless you have plenty of avenues to funnel traffic to them. Even when close, it's a good idea to alternate between roads and avenues to ensure that a large, built-up area has proper support for the volume of traffic it requires. You'll find that, just like mass transit, highways and avenues will seem like a budget strain at first. However, the benefit in the long run is not having to demolish parts of your city to fit in a highway after the fact. If you don't want to spend the money up front, a good thing to do is to leave a 6 wide area through your city in preparation of a highway when things build up. Also, make sure your highways are connected to neighboring cities, not just between districts. That way, people will use them instead of the road connections, lessening gridlock at the edge of your map.