This thesis concerns itself with the provision and commercialization of unauthorized housing in unauthorized settlements within Nairobi. It is based on fieldwork carried out between 1979-1981 and is of relevance to the literature on African studies and third world urbanization. It traces the political and economic factors that have transformed housing provision. In 1960 the housing in such settlements was self-built but by 1980 it was characterized, by the operation of a capitalist housing market, albeit illegal. It is this commercialization process that is the central focus of this thesis. It is related to general developments in Kenya's political economy; namely the development of capitalism and the emergence of African property relations in Nairobi. The 'changing responses of the administration to the growth of unauthorized settlements between 1960 and 1980 are studied, and in particular the shift in policy from demolition towards the tacit acceptance of unauthorized areas. This change encourages the commercialization of unauthorized housing by allowing security for capital investment. - The resulting private housing sector is then examined in one specific area in Nairobi, Kibera. The organization, profitability, distribution of ownership and landlord-tenant relations are all studied. It is shown to be characterized by ruthless operation and by large-scale and small-scale capitalist intervention. The international agencies involvement in low-income housing and the implementation of site and service schemes within Kenya are examined.