Real-world laboratories (RWL) aim to support transformations for sustainable urban development by producing outputs with practical and scientific relevance. To achieve these aims, the local community of which the RWL is a part should be in close collaboration from the start of a project. RWLs offer spaces for ‘thinking outside the box’ and for experimenting with new ideas through concrete interventions into the life world of the community. We provide methodological guidance for researchers on how to design interventions in RWLs that both affect change on the ground and contribute to scientific knowledge. This includes addressing issues important to local communities and generating transformation knowledge about how sustainable urban development can be actualised. We use the case of a project-based master’s course within an RWL in the city of Zurich in Switzerland to demonstrate how the use of design thinking supported the development of needs-based interventions, curbing emissions from food consumption while aiming to generate scientifically relevant output. We conclude that further improvements in methodology are needed in order to test the effectiveness of interventions. However, the outputs of the approach show its potential both for having an impact in the real world and building on existing academic concepts for advancing transformation knowledge.