Surface plasmon polaritons (SPPs) originate from the collective oscillations of conduction electrons coupled with photons propagating at metal-dielectric interfaces. A uniform metallic gratings change the dispersion (energy-momentum relation) of a flat metal surfaces due to the interaction of SPPs with the periodic structure. By breaking the symmetry of the periodic plasmonic structure, SPP cavities can be achieved and SPPs can be localized inside the cavity regions. The aim of this thesis is to understand the physics of phase shifted grating based plasmonic cavities. To this end, we fabricated uniform gratings and phase shifted gratings using electron beam lithography, and optically characterized these SPP structures with polarization dependent reflection spectroscopy. We verified experimental results with numerical simulations SPP propagation and localization on the grating structures. Dispersion curves of SPPs have been calculated by solving Maxwell’s wave equations using finite difference time domain method (FDTD) with appropriate boundary conditions in agreement with experimentally obtained data. We studied the dispersion curve as a function of grating profile modulation where we vary the ridge height and width of the ridges. We find that the plasmonic band gap width increases as the ridge height of the ridges in the grating increases. Optimum duty cycle of grating to observe plasmonic band gap is determined to be half of the grating period. Amount of the phase shift added to the periodicity of the uniform grating defines the energy of the cavity state, which is periodically related to the phase shift. A plasmonic cavity with a quality factor 80 has been achieved. The propagation mechanism of SPPs on coupled cavities is plasmon hopping from a given cavity to the next one.