More telecommunication services are using Internet as single network for voice, video and data transmission. Quality of Service (QoS) guarantee is necessary for such transmission over the internet backbone. Internet is not a simple best-effort network only for web traffic anymore. It is generally understood that present internet best-effort infrastructure is not sufficient to provide QoS guaranteed services. DiffServ is developed to classify internet traffic into different classes, where each class has predefined QoS parameters. DiffServ can be deployed to ensure QoS, but it is unable to deliver QoS guarantees for the network as whole. Using Multi Protocol Label Switching Traffic Engineer ( MPLS TE) we have a dynamic overview of network resources and so we can route the traffic in the whole network satisfying QoS needs for each traffic class, like voice, video, real time etc. In this paper we have demonstrated the usefulness of applying Differenciated Services (DiffServ) and MPLS TE in the network to reduce packet drops for drop sensitive applications keeping the network resources utilization optimized. After application of MPLS TE in a DiffServ enabled network IP backbone we have significantly reduced packet loss. © 2010 IEEE.