you need to redefine one controller and one block
See below code.
**Magento: Skip Shipping Method from onepage checkout** First override following files(ie in local directory) rather than changing the core: 1) app/code/core/Mage/Checkout/Block/Onepage/Onepage.php 2) app/code/core/mage/checkout/controller/Onepagecontrollers.php 3) app/code/core/Mage/Sales/Model/Service/Quote.php 4) app/design/frontend/base/default/template/checkout/onepage/progress.phtml 5) app/code/core/Mage/Sales/Model/Service/Quote.php Once done follow the below steps: **Step 1: app/code/local/Mage/Checkout/Block/Onepage.php** Change the line: $stepCodes = array('billing', 'shipping', 'shipping_method', 'payment', 'review'); In Magento 1.7+ you will find $stepCodes in for each just replace with below code with: $stepCodes = array('billing', 'shipping', 'payment', 'review'); **Step 2: app/code/local/Mage/Checkout/controller/Onepagecontrollers.php** Change the line: protected $_sectionUpdateFunctions = array( 'payment-method' => '_getPaymentMethodsHtml', 'shpping-method' => '_getShippingMeghtoHtml', 'review' => '_getReviewHtml', ); with: protected $_sectionUpdateFunctions = array( 'payment-method' => '_getPaymentMethodsHtml', 'review' => '_getReviewHtml', ); **Step 3: app/code/local/Mage/Checkout/controller/Onepagecontrollers.php** Change saveBillingAction() function with: public function saveBillingAction() { if ($this->_expireAjax()) { return; } if ($this->getRequest()->isPost()) { $postData = $this->getRequest()->getPost('billing', array()); $data = $this->_filterPostData($postData); $data = $this->getRequest()->getPost('billing', array()); $customerAddressId = $this->getRequest()->getPost('billing_address_id', false); if (isset($data['email'])) { $data['email'] = trim($data['email']); } $result = $this->getOnepage()->saveBilling($data, $customerAddressId); if (!isset($result['error'])) { if ($this->getOnepage()->getQuote()->isVirtual()) { $result['goto_section'] = 'payment'; $result['update_section'] = array( 'name' => 'payment-method', 'html' => $this->_getPaymentMethodsHtml() ); } elseif (isset($data['use_for_shipping']) && $data['use_for_shipping'] == 1) { $result['goto_section'] = 'payment'; $result['update_section'] = array( 'name' => 'payment-method', 'html' => $this->_getPaymentMethodsHtml() ); $result['allow_sections'] = array('shipping'); $result['duplicateBillingInfo'] = 'true'; } else { $result['goto_section'] = 'shipping'; } } $this->getResponse()->setBody(Mage::helper('core')->jsonEncode($result)); } } Change saveShippingAction() function with: public function saveShippingAction() { if ($this->_expireAjax()) { return; } if ($this->getRequest()->isPost()) { $data = $this->getRequest()->getPost('shipping', array()); $customerAddressId = $this->getRequest()->getPost('shipping_address_id', false); $result = $this->getOnepage()->saveShipping($data, $customerAddressId); if (!isset($result['error'])) { $result['goto_section'] = 'payment'; $result['update_section'] = array( 'name' => 'payment-method', 'html' => $this->_getPaymentMethodsHtml() ); } $this->getResponse()->setBody(Mage::helper('core')->jsonEncode($result)); } } **Step 4: app/code/local/Mage/Sales/Model/Service/Quote.php** Change _validate() function with: protected function _validate() { $helper = Mage::helper('sales'); if (!$this->getQuote()->isVirtual()) { $address = $this->getQuote()->getShippingAddress(); $addressValidation = $address->validate(); if ($addressValidation !== true) { Mage::throwException( $helper->__('Please check shipping address information. %s', implode(' ', $addressValidation)) ); } } $addressValidation = $this->getQuote()->getBillingAddress()->validate(); if ($addressValidation !== true) { Mage::throwException( $helper->__('Please check billing address information. %s', implode(' ', $addressValidation)) ); } if (!($this->getQuote()->getPayment()->getMethod())) { Mage::throwException($helper->__('Please select a valid payment method.')); } return $this; } **Step 5: app/design/frontend/default/default/template/checkout/onepage/progress.phtml** Remove the shipping method block. **Step 6: app/locale/en_US/template/email/sales/order_new.html** Remove the shipping method block(ie {{var order.getShippingDescription()}}).