The article rigorously analyzes Iraq’s housing dilemma using an interdisciplinary framework combining socio-technological advancements and environmental initiatives. The article promotes sustainable urban development by tackling increasing urbanization, infrastructural deficiencies, and ecological deterioration. The novelty is in the empirical assessment of innovative sustainable building methods, community-focused urban planning, and the implementation of renewable energy, specifically adapted to Iraq’s distinct socio-political and environmental circumstances. The article presents an innovative framework integrating smart city technology with sustainable construction practices, providing a holistic approach to improving housing quality and fostering ecological resilience. The findings substantially enhance the discussion on sustainable urbanization by offering policymakers practical insights to alleviate housing crises and promote enduring urban sustainability. The implications are worldwide since the proposed approaches and frameworks function as scalable models for tackling urban development issues in increasingly urbanizing areas.