Urban villages are widespread in many Chinese cities, providing affordable and accessible housing for rural migrants. These urban villages develop rapidly over time to create more housing units and accommodate increasing numbers of residents. This article provides systematic analyses of urban village development in Shenzhen in the period 1999–2009. It reveals that the development of urban villages was driven by the overall planning and urban growth of the city, which resulted in significant variation in urban village development at the city scale. Three distinct but overlapping phases were observed: expansion, densification and intensification. The growth of urban villages was spatially clustered and changes over time in the distribution of growth centres suggest the possible diffusion of migrant employment out of the Special Economic Zone into two outer districts. In the recent urban regeneration process, the pattern and trend of urban village development is shown to contradict the city’s urban village redevelopment programmes. This not only helps to explain the slow progress of the policy implementation, but also implies severe risks of jeopardizing the migrant housing market in certain urban sections.