The basis of this paper is the proposition that the development of squatter communities and informal housing varies throughout developing regions. Squatter developments follow distinct patterns and develop unique characteristics which are affected by regional cultural variables. The paper presents a framework for investigating how different cultural practices affect the nature of squatter development. It first presents a brief overview of prevailing trends of thought regarding the formation of and response to informal housing development. Its principal argument then emerges from a cross‐cultural comparison of cases of informal development in the Arab Middle East and Latin America. The comparison shows that there is no all‐encompassing model for processes of formation and maturation of squatter settlements. For example, while informal developments in the Middle East have a clearly depoliticized and unobtrusive character, in Latin America such settlements are rarely isolated, maintaining ties to either ruling or opposition political parties. Further analysis elaborates on the definition of culture and its importance as a variable. The argument is made that the purely political/economic circumstances of squatter populations cannot be considered without regard for the cultural contexts in which these are embedded. Finally, the paper critiques the generalized pattern that has emerged to describe the evaluation of informal housing developments in the Third World, despite the key mediating role played by culture. It concludes that a culturally grounded approach may broaden the horizons for housing acquisition by the urban p