Before it carried the highest price tag in town, the neighborhood now called Stuyvesant Town and Peter Cooper Village was an area most New Yorkers tried to avoid.

In the late 19th century, it was known as the Gashouse District, due to an adjacent gas distribution site and the large, leaky tanks that covered its streets. In addition to chemical fumes, the district produced the Gashouse Gang, a group of criminals who later joined the Five Points.

The area began to improve with the removal of the gas tanks during the 1930s, although the city was coping with the Great Depression.

To alleviate the housing crisis bred by economic hard times, the idea for Stuyvesant Town and Peter Cooper Village originated during the 1940s as a proposed post-war housing project geared toward veterans and their families. As part of an effort to eradicate slums, the parks commissioner, Robert Moses, turned to insurance companies and savings banks for help. The land formerly known as the Gashouse District was absorbed by the city through eminent domain and given to Met Life. With the approval of the City Planning Commission and the aid of city and state subsidies, the insurance company in 1946 started to take renter applications for its complex.

Before construction could begin, the site had to be cleared of its buildings and residents. Like their counterparts in Stuyvesant Town and Peter Cooper Village today, the 3,000 Gashouse District families fought for their homes, but to no avail. Met Life broke ground in 1947.