Regeneration policy in the UK has failed to deliver real gains for many of the inner‐city neighbourhoods that it was meant to help, but particularly those on the margins of our most prosperous and affluent city centres. In Leeds in 2008 an independent group of professionals came together through a project called ‘Margins within the City’ to challenge thinking about regeneration in the city. We wanted to find new ways of understanding the neighbourhoods in the rim around the city centre, uncover the potential of these neighbourhoods for future resilience and well‐being and suggest ways forward. A year‐long programme of action research was undertaken to pilot an approach to investigating the social networks, skills and enterprise, and under‐utilised land and buildings in a case study neighbourhood. This paper shows the approach and method for the research, the cross‐cutting themes within the findings and the recommendations for future policy development. It suggests that if social and physical connections are mended, established and extended, then perceptions can be radically changed, resource and ecological leaks plugged, and under‐utilised potential more fully realised.