This essay explores the capacity of a particular low-income housing strategy—incremental housing—to serve as a unit for controlled, sustainable urban growth. Much urbanization in Latin America (a region where nearly 80% of the population already lives in cities) occurs informally and with grave environmental repercussions. Yet most governments don’t have the capacity to meet the need for shelter through traditional housing. I analyze four case studies of incremental housing: projects aiming to compromise between governmental control over land use and service provision, and resident participation in housing construction and personalization. Using interviews, articles, plans, reports, and a self-developed Sustainability Index for Minimal Housing, I analyze the environmental implications of projects in El Salvador, Chile, and two in Colombia. I find themes of incidental environmental benefit with respect to land preservation, formalized infrastructure, and creation of high-density urban neighborhoods. The social and physical durability of housing units— also crucial to sustainable settlement—are dependent on spatial flexibility within rigid structural frames. While the case studies present a unique opportunity for institutional control of urban growth, incremental housing projects would benefit from more explicit environmental criteria guiding their design.