This article focuses on how modern housing environment is shaped via the specifics of construction in extremely challenging weather conditions in the cities of Saudi Arabia. With the overall goal that modern housing must be eco- and human-friendly in mind, the authors have attempted to identify the characteristic features of the Islamic cities and traditional local methods of construction. The article presents typical solutions of local architecture and urban plans, expecting that they might render significant guidelines for the spatial organisation of modern cities. A case study of Jazan city and its neighbourhood has been intended to analyse not only the spatial design of the city but also a recently worked out Masterplan. Both the architecture and the urban planning of Jazan city might serve as a good example of modern interpretation of heritage that underlies high quality housing environment.