In this paper we study the interplay between residential location choice, sprawl and water quality. We propose an urban economics model of a, first, monocentric, then, polycentric city with two di erent residential areas : sewer-serviced suburbia, with small residential lot size, and exurbia where wastewater management is individual and on-site and residential lots are larger to accomodate sanitary requirements. Sewer and septic are also characterized by di erent abatement e ciencies. Within this framework, where development is assumed contiguous, we analyse how wastewater management and commuting costs impact on residential location choice and consequently on sprawl and water quality. According to the abatement e ciency gap between sewer and septic technologies, improving water quality may be achieved at the expense of higher or lower sprawl. The extension to the polycentric setting allows introducing heterogeneities in wastewater and commuting costs that illustrate how independant policy makers may impact the sprawl and water quality of the entire metropolis.