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The loss of life, serious injury, damage to property, and negative effects on livelihoods caused by disasters ought not to be seen as natural events, but rather as a failure of urban management–in which institutions have been unwilling or unable to meet their obligations to urban residents (Lavell 2002). This article therefore examines the role of institutional capacity in reducing the vulnerability of the urban poor to climate change. This is viewed as requiring a series of interrelated activities involving a variety of stakeholders in urban governance, including municipal authorities, national governments, utilities and civil society organisations. After reviewing the scale and extent of the vulnerability of the urban poor to climate change and its linkages to poverty, the article considers the role of these different stakeholders in climate change adaptation and its relevance for improving the social, physical and economic wellbeing of low-income urban residents.