At the first Habitat Conference in Vancouver in 1976 (Habitat I), urbanization and its impacts were new issues for the United Nations, which was created just three decades earlier, when two-thirds of the world's population was still rural. By 1976, however, the world was starting to witness the greatest and fastest migration into cities and towns in history.

That Habitat I event led to the establishment of the UN Centre for Human Settlements in 1978, now known as UN-HABITAT.

In 1976, one-third of the world's inhabitants lived in cities. Thirty years later in 2006, cities are home to half the world's population. Data suggests this proportion will continue to grow to two-thirds of the world's population - or six billion people - by 2050.

This projected urban population growth rate is equivalent to adding one new city of one million people, every week for the next 30 years.

Unprecedented urban growth has had both positive and negative effects. Although the increases have resulted in rising national incomes, they have also meant increased urban poverty. Without concerted action, the urban slum population is projected to increase to 1.4 billion by 2020, meaning one-third of the world's urban citizens will be impoverished and living in overcrowded, insecure conditions.

The starkness of this reality was highlighted most recently by UN-HABITAT in their third State of the World's Cities Report (which was released during WUF3). The Report broke away from previous thinking when it revealed that the urban poor are suffering disproportionately. “For a long time, we suspected that the optimistic picture of cities did not reflect the reality on the ground,” said Anna Tibaijuka, UN-HABITAT's Executive Director. “This report provides concrete evidence that there are two cities within one city – one part of the urban population that has all the benefits of urban living, and the other part, the slums and squatter settlements, where the poor often live under worse conditions than their rural relatives.”

Developing a concerted global action plan to tackle the challenges of poverty, including their urban dimension, was a key outcome of the 2000 UN Millennium Summit. The Millennium Development Goals (MDGs) range from halving extreme poverty to halting the spread of HIV/AIDS by the target date of 2015, as well as significantly improving the lives of at least 100 million urban slum dwellers by 2020.

In 2002, at the World Summit on Sustainable Development, the international community focused attention on how to turn its MDG and Agenda 21 commitments on poverty reduction and sustainable development into reality. The Johannesburg Plan of Implementation, adopted at that Summit, recognized the importance of action at the local level and in urban areas. UN-HABITAT's recently established World Urban Forum was described in the Plan as an event that “could serve to stimulate links among all levels for local action.” It was at this time that Canada announced its offer to host WUF3 in 2006 in Vancouver.