Achieving sustainable urban development amid rapid urbanization requires a deep understanding of how urban density influences human well-being. This study examines the spatial relationship between built-up population density (BUD) and human well-being across Delhi, one of the world’s fastest-growing megacities. Using a combination of high-resolution census data, remote sensing, and spatial analysis, the study identifies markedly uneven urban form characterized by extreme density variation, ranging from 2,884 to 136,385 persons per km² across clusters, and uncoordinated development, particularly in peripheral zones. While BUD significantly affects well-being outcomes, the analysis reveals that beyond an optimal threshold, socio-economic conditions become equally influential. The findings emphasize the urgent need for differential planning strategies: promoting infrastructure and planned densification in low-density peripheries; encouraging mixed-use development in moderate-density zones; and alleviating congestion while enhancing services in high-density, unplanned areas. These insights provide a policy framework aligned with the Sustainable Development Goals, particularly Goal 11, which aims to make cities inclusive, safe, resilient, and sustainable. By emphasizing the spatial heterogeneity of urban density and its implications for well-being, this research provides a valuable lens for urban policy and planning in rapidly growing global cities.