Bangladesh has sustained robust economic growth, led by industrial development and urbanization, for the past three decades. In tandem with its economic development, country has been increasingly urbanizing led by the massive growth of Dhaka, the nation’s capital. Yet urbanization and industrial growth have come with high environmental costs that are increasingly harming Bangladesh’s prospects for continued strong economic progress. Urban environmental pollution is already imposing a significant cost on the economy. Over the last decade, country has improved its policy regime and systems for environmental and pollution management, yet much more needs to be done to arrest the stark effects of pollution and environmental degradation on people’s health and economic productivity. Given the growing environmental challenges that Bangladesh’s cities face, this assessment focuses on the country’s urban areas. The report analyzes the impacts and causes of pollution levels and natural resource degradation in Dhaka and other rapidly growing cities. It updates the first assessment prepared over a decade ago with the aim of (i) better understanding the environmental challenges, trends, and implications of rapid economic growth in urban areas; and (ii) identifying paths toward cleaner and more climate resilient growth through technological changes and institutional, regulatory, and policy reforms. The analysis includes case studies at the city level, including the Greater Dhaka area and other cities of various sizes. Based on the analysis in this assessment, priorities for reform and investment should include the following: (i) enhancing environmental policy and institutions at the national level; (ii) enhancing environmental management at the local/ city level; (iii) strengthening the enforcement and accountability regime; (iv) leveraging market-based instruments to protect the environment and unlock green financing; (v) promoting resource-efficient and cleaner production as a tool for reconciling environmental performance with competitiveness; (vi) harnessing the power of public pressure.