This paper deals with improving the quality of public open space in densely built and declining inner city areas. It investigates the potentials of 'smart' and 'green' redesign of public open space for enhancing public realm and the quality of life. Smart redesign of public open space entails the transformation of public open space into an inclusionary intelligent civic arena which allows citizens to have both face-to-face contact and interaction, and virtual communication by means of free community electronic equipment of space and e-services. Green redesign includes the refurbishing of public open space using green technologies and energy saving elements and equipment. The paper explores the amalgamation of 'smart' and 'green' design approaches and the development of a dynamic 'smart & green' public open space and networked communities as catalysts to handle declining inner city neighborhoods. The thinking behind this approach lies in the urgent need for transformation of unused and meaningless private plots into common semi-public open space within urban blocks in shrinking urban units. Accordingly, we argue that this need reflects a potential double gain, a win-win scenario for simultaneously (a) raising awareness of spatial disadvantages in central urban areas, and (b) enhancing quality of life. Thus, in a broader perspective, urban shrinking units will potentially become more attractive and will gain a stronger economic and social identity. The paper investigates redesign patterns for Greek cities and presents a pilot study for cities of Volos and Larissa.