Urban development has always brought some impacts to the existing settlements’ dynamic. Heritage settlements acted as a resilient effort in adapting urban developments. Based on the archipelago’s potential wealth in ethnic diversities and cultural communities, the heterogeneity of urban society has always existed. Ethnic settlements (such as Chinese) are often found in developing countries. The unique characteristics of Chinese ethnic settlements set them apart from other ethnic settlements in the same city (such as Arab, Javanese, and others) in terms of their physical environment and community activities. The values of local wisdom in Chinese ethnic settlements in Chinatown Area of Malang were explored and compared to Kembang Jepun area of Surabaya, using typology as an approach in data analysis and processing. Urban design elements such as land use, style, building functions, accessibility, circulation, public space, green space, signage and conservation areas were discussed in this study context of urban heritage. The aim of the study was to be the future guidelines to the government in directing special ethnic settlements’ arrangement (especially Chinese) along with the characters, as well as providing theoretical input for academics to strengthen the local characters with relatively different ethnic settlements in various cities of archipelago. This study showed that Chinese architecture tolerate, adapt and maintain physical aspects through buildings and the living culture.