From the mid‐1940s to the mid‐1960s a particular conjuncture of capital‐state relations formed in Australia, leading to the development of a distinctive urban form —‘Holdenist suburbia’: built by government; of a large scale and uniform appearance; constructed of poor quality, cheap materials; home to relatively high percentages of public renters; comprised of predominantly working‐class families; adjacent to manufacturing employment; and stigmatized. An examination of one such Holdenist suburban estate in 1966 and 1991 illustrates how certain aspects of economic restructuring and state intervention have forged such spaces as sites of urban poverty. With the broad aim of connecting Australian urban studies to ongoing international debates about the nature of contemporary urban poverty, it is noted that distinctive characteristics of Australian urban and welfare state development render the application of concepts derived from different cultural settings problematic. This paper makes two points. First, a ‘finer‐combed’ interpretation of Australian postwar suburban development is required to delineate the role of the state in shaping a particular urban form during this period — the Holdenist suburban form. Second, this delineation is particularly important to understanding contemporary urban poverty in Australia, for the social provisions of state policy have, in contradictory fashion, both prevented the full development of outcast ghettos (Marcuse, 1996) and, in conjunction with the processes of economic restructuring, forged sites of urban poverty.