The growth of informal settlements can intensify the risks of social and ecological harm to their communities and to the wider urban area. The unplanned and poorly serviced character of these settlements raises the probability of disasters occurring. The public sector can increase these risks through indifference and poorly conceived actions or it can help to build resilience through a more constructive and integrated approach. This case study from Stellenbosch in South Africa illustrates how a resilience perspective can highlight the systemic challenges surrounding the growth and management of informal settlements. It emphasizes the interactions between such places and their urban context, and recognizes the negative feedback loops that can exacerbate poverty and vulnerability. It proposes adaptive governance as a framework for building resilience through strengthening local capabilities. This flexible and engaged approach goes beyond “just managing” informal settlements to integrating them in a more positive way into the wider city or town.