This article examines coastal urban planning in Costa Rica vis‐à‐vis the country’s values in the areas of sustainable tourism and community development, focusing on the city of Jacó. I argue that an anti‐urban tourism development strategy, swift coastal urban development and weak planning have nurtured a nature–infrastructure paradox: when people are brought closer to nature without proper urban and governmental infrastructure, this causes social and environmental damage. To assess this paradox and understand local perceptions of development, I analyzed lengthy semi‐structured interviews and survey responses in San José and Jacó in this study. Research methods also encompassed analysis of current tourism planning institutions and regulations, tourism media coverage and reports, real estate data, participant observation of planning and community meetings and activities, and observations of the built and natural environmental conditions in Jacó and its surroundings. The findings show jurisdictional fragmentation, regulatory weaknesses, complexity, poor coordination, slow action, and incoherent planning and development, leading to environmental degradation and socio‐spatial inequities. A more balanced approach to planning and development would seek to improve environmental health and socio‐spatial equity in tandem, by nurturing and advancing both nature and infrastructure development. Lessons from Jacó have global resonance, given the expansion of the worldwide tourism and second‐home/retirement‐housing industries, their recent concentration in urban coastal destinations of developing countries, and the fragility of these socio‐ecological systems.