Abstract: On the one hand, business and related activities are at the centre of the production–consumption system that is the major cause of our sustainability problems. On the other hand, the dynamism of modern business and its ability to innovate and generate solutions to current and emerging problems, including those related to sustainability, promises to be one of the primary sources of new ideas and strategies to tackle the sustainability challenges we face. The changes required of business will be more than incremental process and product innovations. Over the last two decades this focus of sustainability innovation has certainly brought us cleaner and more efficient products and services. However, we also need to make fundamental changes to our business models – and the systems that support them – if we are to meet our current and future sustainability challenges. In this paper, we provide a review of some emerging approaches that influence the development of new business models that might assist in sustainability and low-carbon transitions in cities. We draw on examples and on the output of three participatory visioning workshops held in Melbourne and Sydney to explore the potential and implications of these emerging business models in assisting low-carbon transitions in Australian cities. Our findings suggest that although these emerging business models can be part of future cities, there are uncertainties associated with technological, social, organisational and governance aspects which make it difficult to reach a clear judgement on their actual potential in assisting low-carbon transitions.