This study has assessed LULC changes and the dynamics of urban expansion in Greater Dhaka, Bangladesh using RS data in conjunction with socio-economic variables. Urban expansion was quantified for the last 28 years using the post-classification comparison technique. Greater Dhaka was found to have experienced rapid changes in LULC, particularly in built-up/urban areas. Analysis revealed that urban areas increased by 6131 ha during 1975–1992 and 4422 ha from 1992 to 2003, which resulted in a substantial reduction in the area of water bodies, vegetation, cultivated areas and wetlands/lowland. The dramatic expansion of the urban areas of Dhaka exhibited clear spatio-temporal differences. The conversion of water bodies, vegetation and low-lying areas to urban land has caused extensive and varied environmental degradation in the study area, and the vulnerability to flooding and the growth of slums have been the main negative outcomes associated with the rapid urban development. Urban land expansion has been largely driven by elevation, population growth and economic development.