Climate change is the greatest threat to the global environment and economy. This, when coupled with fears over energy security of supply, has stimulated energy efficiency and improved environmental performance to combat carbon emissions and the climate change impacts due to CO2 and other greenhouse gases as well as reducing reliance on imported fossil fuels. The Code for Sustainable Homes is the current energy efficiency and environmental impact rating system for new housing developments in the UK. It provides a strong basis for future sustainable building standards but is facing a range of challenges regarding the development of Zero Carbon Homes, which include technical, legal & regulatory, economic, social & cultural and delivery capacity. The UK government needs to adopt a proactive approach for carbon reductions from the housing sector bearing in mind different housing types and future trends under prevailing land use policies and strategies. Informed delivery options under Code, minimising all social, economic, technical and environmental challenges will be the key drivers for Zero Carbon targets and the way forward for a code for urban development in the broader context.