This paper examines how different social, economic, historical and physical conditions coincide in the formation of space and processes of decline in the period of transformation in Poland. The focus lies on a specific residential area in the centre of the Polish city of Gdansk and the question why no improvements have been done in this particular area to stop its successive decline. It is among other things argued that clear urban policy together with improved urban planning and clear legislation on ownership are needed in order to improve conditions in this and other deprived areas of the city.