Cohousing communities are planned, owned and managed by their residents. They are developed by groups of people who want more interaction with their neighbours. Private homes, complete with full kitchens, are supplemented by extensive common facilities, such as a large kitchen and dining room where residents can take turns cooking for everyone, laundry, gym and child care. Through spatial design and shared social and management activities, cohousing facilitates interaction among neighbours, for the social and practical benefits. There are also economic and environmental benefits to sharing resources, space and items.

Because each cohousing community is planned in its context, a key feature of this model is its flexibility to the needs and values of its residents and the characteristics of the site. Cohousing can be urban, suburban or rural. The physical form is typically compact but varies from low-rise apartments to townhouses to clustered detached houses. They tend to keep cars to the periphery so that people can use the spaces between the houses.

Historically, most people lived in dwellings with their extended families - the single family home was for upper and upper-middle classes. Thus the idea is very old, but the idea of choosing such housing when one can afford more space and separate facilities for each immediate family is more associated with the 1960s.

Some elements of the Jewish Renewal at that time for instance encouraged the interconnection of basements among neighbours, to create common shared space useful especially for celebrations. Each house would however remain separate and have doors to keep it separate from its neighbour.

The modern theory of cohousing originated in Denmark in the 1960s among groups of families who were dissatisfied with existing housing and communities that they felt did not meet their needs. It was introduced to North America by two American architects, Kathryn McCamant and Charles Durrett, who visited several cohousing communities and wrote a book about it, Cohousing: A Contemporary Approach to Housing Ourselves. Several cohousing communities exist in Denmark and the west coast of the U.S.A, especially California.

There are over 50 operating communities in North America with about 200 others in the planning phases. There are also communities in Australia, the UK and other parts of the world.

Cohousing differs from some types of intentional communities in that the residents do not have a shared economy or have a common set of beliefs or religion. There is no single leader, although various individuals do take on leadership roles, such as being responsible for coordinating a garden or facilitating a meeting. Models of consensus democracy are usually involved in managing co-housing, as consent of everyone living in the house is important to maintain harmony.

Cohousing is a social structure, and so differs from condominiums or co-operatives which are legal-financial structures. A cohousing community can also be set up as condominium or co-operative, legally, with shared ownership.

Eco-feminism is particularly supportive of co-housing due to child care convenience and the immediate availability of mutual support in cases of spousal abuse including verbal abuse. In effect, the cohousing can act as a women's shelter, especially if the females exclusively hold ownership rights - as in the traditional Huron or Iroquois longhouse which were more or less run by the elder women.

The Eden Alternative nursing home and the rural eco-village embrace cohousing as well, but with specific assumptions about the Ecological Footprint and desirability of multi-generation circles to run things. In combination, they approach eco-anarchism or New Tribalism, and transending housing itself as an issue.