Shanghai's moment has arrived. Fueled by years of growth faster than China's as a whole—and a culture now unshackled and dealing comfortably with the outside world—the city is eager to recapture the glories of the past, only this time on its own terms. Twenty years ago the European buildings on the Bund stared across the Huangpu River at low-lying farmland dotted by factories; today that same land bristles with skyscrapers, including the 101-story World Finan­cial Center. All told, the city has added more than 4,000 high-rises. For a place once dominated by rickshaws and bicycles, the most extraordinary statistic may be not vertical but horizontal: nearly 1,500 miles of roads in and around Shanghai that did not exist a decade ago.

And now comes Expo 2010, part of a fading franchise Shanghai hopes to resuscitate as a global launching pad. It's a gamble, but the city has reportedly anted up $45 billion, more than Beijing spent on the 2008 Olympic Games. The bulk of the money has gone into infrastructure, including two new airport terminals, a subway expansion, and a Bund makeover. But amid a global economic crisis, will the projected 70 million visitors come? Shanghai hopes to outshine rivals Beijing and Hong Kong, but it also harbors a loftier ambition: to be the global capital of the 21st century. "If any city has a chance, it's Shanghai," says Xiangming Chen, a professor at Fudan University in Shanghai. "But the city can't just build its way to greatness. The bigger question is, How does it rebuild a sense of community that's been lost in tearing down the old and building up the new?"

Jin Qijing pretends not to notice the rat scurrying across the pipe in her room. Dinner is on the table—a sweet and fatty braised-pork dish, hongshaorou, that is a Shanghainese favorite—and the elegant 91-year-old with a sweeping, gray coiffure doesn't want to spoil the family meal.

Nobody needs to remind Jin that conditions in her traditional Shanghai neighborhood, or lilong, have deteriorated since she moved here as a teenager in 1937. Back then her lilong—one of thousands in Shanghai that set modified Chinese courtyard houses on tight European-style lanes—lived up to its name: Baoxing Cun, or "treasure and prosperity village." One family lived in each house, often with a coterie of servants and rickshaw pullers.

Today eight families cram into Jin's two-story home, one per room. There is no plumbing. Jin's kitchen is an electric stove erected on a rickety, makeshift balcony. Nonetheless, when Jin's grandson invited her and her husband to move into a modern apartment complex in the suburbs, she refused. "Where else," Jin asks, "could I find this sense of community?"

Shanghai's old neighborhoods are disappearing. In 1949 at least three-quarters of Shanghainese lived in lilong; today only a fraction do. Two lilong adjacent to Baoxing Cun have been demolished, one to make room for an elevated highway, the other for a power switching station to light up Expo 2010. But Baoxing Cun's densely packed alleyways still evoke the communal feeling that made lilong the cradle of Shanghainese culture. In the morning, on her way back from the open-air market, Jin passes the shop selling shengjian bao, sweet, pork-filled breakfast buns. She chats with a neighbor hanging laundry on one of the poles that festoon the lane, while a man, still in pajamas, waters his plants. "I'm back!" Jin yells, as she climbs the unlit stairs to her second-floor room. Neighbors' heads pop out of their rooms to greet her.