The concept of ‘home’ plays a critical role in designing care environments for individuals with dementia, extending beyond physical space to include identity, familiarity, and continuity with life stories. This study explores the intersection of narrative and spatial design, presenting a narrative-based approach to creating living spaces that preserve and support personhood. As dementia progresses, recalling and organizing personal stories often becomes challenging, increasing the importance of environmental cues in maintaining identity. A participatory co-design methodology was employed, engaging individuals with dementia, care staff, and researchers to develop spaces resonating with personal and collective narratives. Narrative elicitation sessions captured participants’ life stories, preferences, and sensory experiences, which were translated into tangible design elements. The resulting environments go beyond functionality, becoming extensions of residents’ life stories that promote emotional well-being, reduce stress, and enhance belonging. By embedding narrative-driven elements such as familiar objects, textures, and sensory cues, the design approach ensures that care environments remain adaptable and deeply personalized, supporting identity amidst cognitive changes. This study underscores the therapeutic value of integrating narrative into design processes, advocating for care settings that reflect the unique identities of their residents while fostering connection and continuity.