YOU'RE GONNA HAVE TO serve somebody,' trills Zack McKown as he tries to explain his nearly 30 years of collaboration with partner Calvin Tsao . It's not often that you hear an architect quoting a Bob Dylan song when describing a business philosophy, but Tsao & McKown Architects is far from the typical firm. Since the duo-Tsao, 60, and McKown, 61-opened their office in 1985, they have worked for a variety of clients, from bold-faced names like Ian Schrager (an apartment and bar at Morgans hotel in Midtown Manhattan) and André Balazs (a 47-story condominium in Lower Manhattan) to the decidedly lower-profile, like the group of Buddhists monks in Bhutan for whom they're currently planning a retirement home. Now, thanks to Octave, a development company Tsao cofounded with his brother, Fred, the architects are working on their most ambitious project yet: designing new communities in China that stand in stark opposition to the monolithic cities that seem to sprout up across the country overnight.

As part of Octave, Tsao & McKown Architects currently has two different projects under way in China, both of which will be completed in the next two years. Octave wants to develop diverse, pedestrian-friendly live-work communities where people of all economic levels have suitable housing as well as easy access to cultural facilities and the outdoors. 'One of the difficulties with architecture is that, unlike art, for example, it's not about self-expression alone,' explains Calvin, sitting in his New York City studio. 'It's about enriching people's lives.' It's this combination of curatorial discernment and utopian vision that forms the basis of his alliance with Fred, who is the chairman of IMC Pan Asia Alliance Group, a shipping and real estate conglomerate that's the latest iteration of the Tsao family business.

After years of witnessing the ravaging effects of China's rapid transformation from a rural to an urban society, the Tsao brothers decided to devise an alternative. (According to the McKinsey Global Institute, if current trends continue, China will have 221 cities of a million or more inhabitants by 2025. In comparison, all of Europe has only 35 such cities.) It's no easy feat in a country that has been destroying evidence of its past at an unprecedented rate. At a lecture at the Architectural League of New York last April, Wang Shu , China's most prominent architect, bemoaned the 'crazy change' sweeping his homeland, noting that 90 percent of traditional buildings have been destroyed in recent years. 'If China doesn't develop well, we are all finished,' says Fred. His brother agrees: 'We realized we couldn't just sit on the sidelines and complain about it or criticize it without participating. But how we can get into it and find a platform or a road map has just been trial and error.'

Descended from a family with roots in Shanghai, Calvin first traveled to mainland China in his twenties, when he went with his then-boss, I.M. Pei , to work on one of the first major projects of the post-Mao era: Beijing's Fragrant Hill Hotel, a synthesis of traditional Chinese forms and new building techniques. Lessons he gleaned from that project-being authentic to the place while shirking nostalgia-are embedded in Octave's design methodology and business plan.

Officially launched six years ago, Octave began as a think tank of sorts, convening workshops and conducting its own research into issues like urban farming, biodiversity and integrative medicine. There were seminars mixed with field study: Calvin took the Shanghai-based members of the project team on tours around New York to scrutinize what makes cities dynamic, focusing on questions like how the farm-to-table movement has transformed the local restaurant scene. Octave's long-term goal is to create an urbanity that is new to the China of today, yet not so foreign as to be alienating. 'It's a balance between what we think is right and what we think the audience can understand,' explains Calvin.

Though Tsao & McKown Architects is simultaneously working on several other projects for clients in the U.S. and Asia, Octave is keeping the office busy. As Octave's creative director, Calvin oversees all design aspects while the firm at large is responsible for building many of the individual structures. As a longtime advocate of urban public spaces, McKown points out that the line between architect and client shouldn't be too finely drawn: 'To make the forms, you have to be part of deciding the uses,' he says of his firm's strategic role.

CALVIN TSAO AND ZACK MCKOWN met in 1976 at Harvard's Graduate School of Design-fighting over desk space, according to lore. The official description of their firm is 'an eclectic group of accomplished individuals,' and it has produced everything from a lipstick case for Shu Uemura and installations for fashion designer Geoffrey Beene to private houses and a $1.6 billion mixed-use development in Singapore called Suntec City. Their trademark is not stylistic, they say, but rather an ongoing meditation on the question: What is architecture today?

One of Octave's first big accomplishments was successfully negotiating an agreement with the Chengdu government to develop a 240-acre site on the banks of the Min River, near the Himalayas. Since the mountainous terrain offers an excellent platform for studying biodiversity, the company hatched a development plan that includes research facilities, a wellness center and an academy to study traditional Chinese medicine-the building blocks of a new local economy. A panda preserve near the site will help to ensure a steady stream of tourism, so hotels and a vibrant commercial district are also part of the overall plan. Add in artist studios and you have the makings of a self-sustaining and culturally rich community.

While the Chengdu master plan was put on hold following the massive earthquake in the region in May 2008, it has informed smaller-scale Octave projects that are now being developed. The Dalian Agora, a residential and commercial tower designed by Tsao & McKown located in the seaside city of Dalian, is meant to revitalize the area around a historic school building. The Shanghai Learning Center, developed in response to China's one-child-per-family policy, will also be completed at the end of 2013. 'Children are a precious obsession in China,' says Calvin. Octave is currently creating a curriculum for new parents that combines play and learning. Another project, Harmony Hotel-set on a lakeside in Suzhou, about an hour and a half from Shanghai-will be a mix of villas and apartments, a hotel and spa, an integrative medicine clinic and an organic market; it's planned for 2015.

'They only take on projects that can have a positive social impact,' observes Harvard University professor Peter Rowe , an expert on urban planning in Asia who has advised the Tsao brothers. 'I've even seen them walk away-with money left on the table-when they don't get the quality they're after.'

Fred attributes the genesis of Octave to a traditional Chinese proverb he was taught as a child. 'My parents would say, 'I'm well. You're well. And all is well,' ' he recalls, speaking by videoconference from Octave's office in Shanghai. For Fred, it was a message that the pursuit of one's personal well-being should not be separated from the pursuit of the well-being of all. To accomplish this, the team is willing to take their time theorizing and designing-even if it means delaying profits. As Fred says, half joking about the family business, 'We don't have to worry about shareholders kicking us out after a year or two.'