Across some Southern European cities, urban renewal programmes are seen as the primary means of alleviating concentrations of poverty and social inequality by improving local living conditions. Over the long-term delivery phase, such area-based interventions are often confronted with unforeseen macro-scale urban dynamics related to mobility of people and capital. Since the mid-1980s, Barcelona’s municipality has introduced a series of urban renewal programmes – PERIs (Special Plans of Interior Reform) – to deal with deprived neighbourhoods of the city centre suffering from poor housing conditions, inadequate services and infrastructure, and decreasing population. Selective demolition (or esponjamiento) was a key mechanism to create new open spaces in the crowded city centre whilst building new housing stock to relocate families. Urban interventions ranged from large-scale demolition of entire blocks in the Raval neighbourhood to micro-scale demolitions in the Santa Caterina & Sant Pere neighbourhood. This paper seeks to evaluate and compare the social and urban effects of urban renewal programmes in the two neighbourhoods between 1985 and 2009. Longitudinal quantitative analysis is employed to isolate demographic, socio-economic and housing changes, consider the remarkable increase in foreign population unforeseen in the original programmes, and hint at changes in space consumption and housing affordability. Finally, questions on inequality and state-led gentrification are raised, whilst considering dynamics of social and spatial desegregation as well as population substitution and displacement.