This study aims to identify the construction system and strategy of settlement arrangement by literature review and field observation. The results show that the construction system of Bajo house uses simple construction and local material. Column and beams build from mangrove stems. Wall materials are dominant from the woven bamboo blade with plastering. At first, the roof material was dominant from sago palm leaves and now it is dominant from zinc material. The arrangement strategy of Bajo settlement consists of 3 categories: (1) Economic sustainable: developing of home industries, fish sprouts, coastal ecotourism (2) Sustainable Environmental: sustainable waste management, sustainable fishing system, banning of fish bombs, preservation, and reforestation of mangrove. (3) Social sustainable: improvement of infrastructure, utilization of rainwater and solar energy, preservation of local wisdom.