The urban slum in the less developed world has an overwhelming significance of place for its dwellers: it determines who they are, what they do, where they go, and whom they know. Unlike most Western cities where the different realms of life (residential, work, religious, public, etc.) are spatially segregated, here they are all functionally and spatially integrated. A close examination of slum spaces in Dharavi, Mumbai, reveals such overlapping spatial patterns and raises some fundamental questions. Is there a proper definition of the slum? How should we conceive of the slum community and its spatial features? How useful or problematic are Western concepts of residential segregation, ghettos and enclaves? It is argued that the historical persistence of urban slums points to their indispensability, with the tacit (if inconsistent) approval of the state. Slums not only provide shelter to a large urban labour force but also a milieu that is conducive to intense social organisation and economic production.