Metropolitan cities are undergoing a major spatial and environmental transformation. The proliferation of business districts, corporate headquarters and international hotels is prompting a massive verticalization and densification of land use, which is affecting the urban environment and infrastructure in a number of ways. Nowhere are urban environmental pressures so accentuated as in Third World metropolitan cities. Here the rush to gain a competitive edge in the global economy, in order to attract multinational firms and become a 'global city', is leading to an inconsistent urban policy framework in which development policies frequently clash with environmental policies. This article explores the environmental complexity of Third World metropolitan cities, focusing on the cases of Beijing and São Paulo. After a conceptual review of the relationship between globalization, cities and urban environmental problems, it examines how globalization is prompting spatial and environmental transformations in both cities; looks at the dichotomy between development policies and environmental policies by analysing the instruments in place; and investigates the role of globalization visàvis urban sustainability issues.