A method and system for interworking between cellular networks and wireless local area networks (WLANs) are disclosed. At least one cellular network, at least one WLAN and an IP network are deployed. A wireless transmit/receive unit (WTRU) first establishes a connection to a WLAN and a tunnel between an access point (AP) and a packet data gateway (PDG) is established. The PDG further establishes a tunnel to an IP network. The WTRU then invokes a service which is delivered through the WLAN. As signal quality from the AP degrades below a predetermined threshold, a handover from the WLAN to the cellular network is performed. A new connection to the cellular network may be established either before or after breaking the current connection to the WLAN or the two connections may be maintained simultaneously.