Rapid urbanization in developing countries has been accompanied by the spread of informal settlements, which is particularly prominent in sub-Saharan Africa. These settlements have become an important supplement to the inadequate formal housing supply in cities, and their spontaneously formed spatial patterns have important influences on sustainable development. In this study, qualitative and quantitative approaches were used to examine the morphological characteristics of informal settlements in Tanzania and the associated influences on urban development. Geographic spatial analyses, landscape pattern indices, and mathematical statistics, along with quick assessments, group discussions, and key informant interviews, were used to obtain detailed information on the spatial forms of informal settlements. The results indicate that the form of the settlements does not conform to the social, economic, or environmental characteristics of sustainable development. The disordered expansion of single-layered buildings with a single function, irregular road networks in poor condition, and a lack of consideration and protection of the ecological environment were found to negatively impact urban function and sustainable development. However, the structure and form of informal settlements could, in addition to formalization projects, be optimized to drive sustainable and socioeconomic development goals as well as environmental conservation.