One of the most enduring themes behind the search for more sustainable urban forms is that of the pattern or density of development. The chapter identifies eight neighbourhoods each representing a particular residential pattern from the three case study cities of Amritsar, Chandigarh and Gurugram and presents a detailed study of the relationship between the different physical density variables (denoting the pattern of development) and indicators of environmental quality. It shows that all the measures of density (people density, building density and spatial density) have significant impact on environmental quality. Crowding and congestion increases with increase in people density. Activity intensity and activity diversity also show an increasing trend with increasing residential density thus suggesting that more people engage in different activities and greater social interaction happens in high density neighbourhoods. Other aspects like presence and condition of sidewalks, streetlights, outdoor furniture, level of cleanliness, etc. determine peoples’ desire to reside in, walk through and utilize spaces. The arrangement of buildings and open spaces in a neighbourhood have considerable effect on the micro-climate. Both shade and naturalness—measures of nature-based solutions increase the outdoor comfort conditions for the residents especially during the summer months. Also, proximity to daily needs, good condition of sidewalks and open spaces along with optimum level of services helps in creating walkable neighbourhoods. The study thus gives objectivity to an otherwise abstract and subjective term ‘environmental quality’. It validates the conceptual framework and helps formulate guidelines for environmentally conducive development of residential neighbourhoods for future sustainable cities.