<p>Policies intended to support people experiencing homelessness (PEH) can, at times, reproduce or intensify the very vulnerabilities they seek to alleviate. This comparative study examines how homeless shelter environments shape everyday life and substance use among homeless shelter residents (HSRs) in Athens (Greece) and Santiago (Chile), two cities characterised by neoliberal policy reforms and constrained social welfare systems. Drawing on the risk environment framework and employing a mixed-methods design, the study analyses both public-sector and community-run shelters to explore how institutional models structure social relations between HSRs, interactions with staff, coping practices, and access to support. Policy mapping is used to assess how shelter design, regulatory intensity, and policy density influence the organisation and operation of temporary accommodation across the two contexts. The findings indicate that community-run shelters are more likely to foster interpersonal connection, participation, and a sense of belonging, whereas public-sector shelters are more commonly associated with social isolation and marginalisation. These institutional differences have tangible implications for substance use, which emerges both as a coping strategy and as a response to shelter governance and everyday conditions. By foregrounding the lived experiences of HSRs, the analysis demonstrates how shelter policies and practices can generate either harmful or protective social environments. The study concludes by arguing for community-oriented models of temporary accommodation, supported by sustainable funding structures that prioritise dignity, social connection, and wellbeing within homelessness services.</p>