Transformative capacity (TC) is key for addressing climate change impacts. It refers to urban areas’ ability for profound and intentional change to address current challenges and move towards a more desirable and resilient state. However, its varied applications across disciplines can lead to misunderstandings and implementation challenges. Thus, this Semi-Systematic Literature Review (SSLR) on TC within urban studies from 2016 to 2022 aims to overview and synthesise TC literature and its gaps to inform ongoing debates, intersecting it with climate-related research. The results show an increasing interest in TC within two fields of knowledge: resilience studies and transformative research. The review found TC as a catalyst for transformative actions, promoting sustainable pathways, enhancing resilience, and driving fundamental changes in urban climate adaptation. Finally, the prevailing literature gaps concern the TC concept’s fragmentation, excessive research on governance features, and lack of joint research about TC and innovation.