Buildings affect aeolian sediment transport and bedform development in sandy environments. Cellular automaton (CA) models have, however, only been used to simulate natural bedform dynamics. This study extends a well-known aeolian CA model to include sediment dynamics around buildings, and uses this model to explore the interaction of building-induced deposition and erosion with natural bedform dynamics. New CA rules are introduced to represent acceleration, deceleration and sideward transport of sediment around obstacles. The simulated deposition and erosion patterns show good agreement with field experiments. The model reproduces the shape and location of the morphological pattern around a single building, and effects of building spacing on this pattern for building groups. Model results further demonstrate that building-induced effects interact with local bedform dynamics and can alter the shape, growth and migration of sand dunes.