I strongly suggest you read the celebrated and widely read and revered books on Ancient India by:
- Romila Thapar (Marxist in views)
- A. L. Basham (Non-partisan)
You can also refer to the bibliography of the Wikipedia page Indian campaign of Alexander the Great.
In earlier times, India ran from the Hindukush mountains(Afghanistan) to the Himalayas, and from the Himalayas to Kanyakumari. So today's Pakistan was also part of India.
Here in this context, "Brahmin towns" means "the towns of the people who followed the Vedic traditions".
The peculiar feature of the Indian society, even today, is the caste system. Caste was based on birth and one has to work according to his/her caste. The caste may also have sub-caste. For example, Maratha caste has Kunbi-Maratha as sub-caste. All the castes are grouped into four Varnas:
- Brahmin (priests): caste eg: Pancha-Gauda. (its one of the division)
- Kshatriya (warriors): caste eg: Marathas.
- Vaishya (Traders): caste eg: Maheshwaris.
- Shudra (workers and slaves): caste eg: Mahars.
Sometime the term "Vedic culture" is used interchangeably used with "Brahminic culture". That's why villages or towns which followed Vedic traditions were called "Brahmin" villages or towns.
In India, there was (the caste system was officially abolished by Articles 15 to 18 - Indian Constitution) a very strong caste-based society. But there were never separate villages for different castes. However, there were separate parts of the same village for separate castes.
Only the Shudras or Chandals live outside the villages, but not in separate villages.
Even if the single-caste-town exists in ancient India, it is very rare, almost negligible.
So, There is no question of the practice of the single-caste-town going out of fashion. However, there is a question of caste system itself going out of fashion.
There is no longer a caste classification according to Brahmin, Kshatriya, Vaishya and Shudra.
Today, due to reservation policies, instead of asking castes, people are asking "who are you, Open, OBC, ST-SC or NT".
Even though there are lot of caste problems, mainly due to electoral politics,
thanks to India's Constitutional Fathers the caste system is on the verge of elimination.