This paper concentrates on economic, institutional, financial and legal matters that have a direct impact on sustainable planning and development. It reflects the research that is being developed in colonias on the Texas side of the US-Mexico border region. Colonias in Texas are defined as areas with substandard housing, inadequate plumbing and sewage disposal systems, and low-income residents. Three case-studies are presented: the first refers to micro businesses and their potential to promote local economic development; the second is related to the “legalization” of “informal” developments; and the third refers to the sustainability of micro-credit for house improvement. Colonias, mainly isolated from urban areas, are starting to enjoy a relatively stable population, and regardless of the many difficulties they face, colonias are showing signs of being livable communities. This paper discusses these low-income communities from the point of view of promoting local economic and community sustainable development.