Since the 1990s, South Africa has faced a high rate of urbanization and increasing formation of informal settlements. However, the focus of urban planning has not changed to accommodate new urban trends. The current dominant practice of urban planning, still rooted in the global North realism, reflects an increasing discord between current approaches and growing problems of poverty, inequality, informality, rapid urbanisation and socio-spatial fragmentation. Traditional urban planning approaches and state-led direct settlement interventions have arguably served to exclude the urban poor with a marked failure to sustainably address the problem of informal settlements. This research examines the case of Stellenbosch, Western Cape, and argues that the concept of coproduction is an alternative dynamic model that could be used to achieve inclusive and sustainable urban environments. Re-organising institutional relationships would arguably lead to a more successful service production approach and engagement between the state and the urban poor. I use the lens of coproduction to assess partnership-based in-situ community-driven informal settlement interventions. The research uses the Langrug informal settlement upgrading programme as a case study to analyse the institutional arrangements and to examine power relations in a context-specific coproduction process. The research uses semi-structured interviews, field observations and secondary data to examine the nature of the partnership, institutional relations, scope and approach of the Langrug upgrade programme. The study concludes that the Langrug upgrade programme depicts a typical coproduction arrangement where many institutions are collaborating to improve the living conditions of the urban poor in Langrug. Further, the study establishes that the success of this partnership depends on on-going effective management of power and institutional dynamics and low-level conflicts. The study recommends that the Slum Dwellers International (SDI) alliance needs to build stronger grassroots structures in Stellenbosch to increase local capacity in community mobilisation and advocacy. Besides the need to incorporate the media, the partnership must improve the communication system among partners and stakeholders to avoid mistrust and ensure productive state-society engagement. Finally, more comparative case research needs to be done to consolidate arguments on the concept of coproduction vis-à-vis planning practice in the global South.