In the decades to come, the majority of humans will live in urban settings. Consequently, the role of cities in reducing socio-economic material and energy flows is increasingly recognized. We examine the recent literature on urban energy and material use, and their reduction potential, focusing on three aspects: the urban form, the urban building stock, and urban consumption patterns. Although there is clear evidence of the huge saving potential resulting from better urban form and better building design, implementation remains an open issue. Regarding urban consumption patterns, we point out that there is increasing evidence that household income strongly correlates with embodied energy and material use. This has implications regarding how urban specific energy and material flows should be measured, but might also lead to the insight that technical fixes will eventually be offset by the income effect. Although not the focus of this review, social inequalities in using or having access to resources in cities are stressed as a largely neglected dimension of the debate.