This paper deals with the process of transformation of a cultural quarter developed at al-Amin district inside the Old City of Damascus. In 2006, approximately 25–30 artists, moved to this historical neighbourhood and settled in its traditional houses, changing their function into studios/ateliers. One year later, the district was called “The Artists’ Quarter” with the acknowledgment of local and international institutions. The presence of artists’ studios and many cultural events in the area has contributed to the discovery of the rich architectural and cultural heritage of the neighbourhood and the development of a new sphere of public encounters. This quarter became a destination for tourists as well as for locals. Unfortunately, during the war in Syria, started in 2011, different negative changes have happened at al-Amin district. The study aims to (1) Highlight the origin and development of the quarter from the point of view of the artists and the dwellers; (2) Study the spatial and socio-economic effects caused by the “Artists’ Quarter”; (3) Evaluate the changes in the traditional houses due to change of their function; (4) Investigate the actual situation due to the war. Information was collected mainly from interviews with several artists, with hotels' managers and shopkeepers in the quarter, in addition to literature review, consultation of maps and plans and on-site observation. Results of the study will help in understanding this model of urban development and try to set up recommendations for integrated development and heritage management of this neighbourhood.