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Although the process of building urban resilience is increasingly and globally promoted, we consider this concept, and the approaches to achieve it, as particularly challenging for cities in developing countries. We argue that current market-oriented processes of urban upgrading reflect a revival of modernization concepts that, as a consequence, is deepening inequality and limiting adaptive capacities of people to cope with livelihood disruptions resulting from natural disasters and climate change. Efforts in building urban resilience thus become more difficult for marginalized urban dwellers. We explored current climate-related hazards and their impacts on urban livelihoods in selected urban communities in the city of Phnom Penh. We adopted a mixed methods approach, and our key findings revealed limited local government attention to improving infrastructure and a lack of commitment to assist vulnerable urban poor communities to build resilience to natural shocks. Policy recommendations include supporting livelihood improvement programs, addressing land tenure insecurity, and improving basic infrastructure in informal settlements.