Gas Turbine shroud is a static component, which forms the outer flow path surface and sealing clearances to turbine blade tip. It also protects the casing from hot gases ingestion and radiation. Shrouds are segmented circumferentially to accommodate the large thermal gradients. The sealing between adjacent segments and the hook clearances play an important role in controlling hot gas ingestion and loss of efficiency. Heavy duty engine shrouds are typically bulky and machined from either forged ring or investment casting. They have tight tolerance-controlled hooks and hence controlled clearances with casing. It incorporates intersegment seals to control leakages between adjacent segments. On the other hand, Aero-derivative shrouds are typically thin and sheet metal fabricated. Tight tolerance control is not possible in sheet metal hooks and use of intersegment seal is also not feasible in these thin structures. Hence both the design features and approach to address sealing criteria will be different. In this article, it presents the challenges like manufacturing constraints and life requirements and the optimization study that was performed to meet the sealing criteria considering these challenges.