Many cities around the world are redeveloping their neighbourhoods as arts and cultural precincts. Urban industrial zones and lower-income residential areas have taken on new life as arts neighbourhoods in a bid to attract high-yield visitors, propel their creative industry and brand themselves as attractive to investors and residents. This article has two aims. Conceptually it explores the notion of arts urbanization – the creation of arts spaces in cities and the socio-spatial dynamics which they embody. Empirically, the concept is tested using the case of Singapore's Arts Housing Scheme. Under this scheme, historic ethnic precincts take on new roles as arts and creative belts. While the scheme has yielded some success by way of fostering spaces of identity and inspiration for artists, it has also generated social concerns and spatial challenges. Singapore's Little India offers an empirical setting to explore this concept. The paper argues that geography matters to the arts and that arts-led urbanization creates distinct spatial configurations in cities. For this reason, a greater understanding of and research into arts neighbourhoods and their socio-spatial dynamics are essential if we are to aspire to sustainable and sensitive development of cities and their creative communities.