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If you want a sense of the challenges facing Asia's physical environment, just go to Beijing?and breathe. The Chinese capital's constant swirl of production, construction and transportation creates a noxious smog that blankets the city on bad days, cutting both visibility and life expectancy. At the junior world track-and-field championships in Beijing this August, young runners choked and sputtered their way to lackluster performances, a bad omen for the 2008 Summer Olympic Games. Asia has a history of holding an Olympics in a city with foul air. Tokyo, site of the 1964 Summer Games, was so polluted in the '60s and early '70s that citizens walked the streets in surgical masks, while Japanese cities like Minamata, where thousands were stricken with severe neurological damage due to industrial mercury poisoning, became bywords for ecological catastrophe. Fast-industrializing Japan was commonly expected to become an environmental dystopia. But today, Tokyo is one of the world's cleanest megacities, with the view often clear all the way to Mount Fuji. Stricter laws, tougher enforcement and a hard-earned environmental consciousness have made Japan a nation whose record is something to which other Asians can aspire, rather than a misery to be deplored.

Asia is at a crossroads. The question facing the region today is whether the forces that allowed Tokyo to clean itself up can kick in quickly enough in Beijing, or Bombay, or Jakarta, or a thousand other places where environmental damage threatens the quality of life for this generation?and the next. We can't wait long for the answer. By any measure, the state of Asia's environment is depressing. In the Philippines, a mountain of trash looms outside the capital. In Vietnam, the fertile Mekong River is imperiled by upstream damming. In Chongqing, the worst drought in a century is draining what little drinkable water is left. In Nepal, melting alpine glaciers are threatening to release devastating floods on the land below. In India, the Bengal tiger is nearing extinction, and it might just be joined one day by the foreign executive in Hong Kong, where pollution is driving expatriates to flee to greener cities. As for Bangladesh, you could churn whole forests listing its environmental troubles, but it might not matter?if global warming causes sea levels to rise just 1 m over the coming decades, 17% of the country will be underwater anyway.

Bringing this litany of disaster to an end will not be easy. For here is Asia's dilemma: the forces damaging the environment are the same ones that drove the economic miracle that has lifted more than 270 million Asians out of poverty in the past 15 years. Economic growth means more production, more jobs, more food on the table, but it also means more smokestacks, more logging, more chemicals dumped into the water. Asia, however, is running out of room to grow. A 2005 United Nations report warned that although one-fifth of Asians still exist on less than $1 a day, "the region is already living beyond its environmental carrying capacity." In August, Zhou Shengxian, director of China's State Environmental Protection Administration, said: "It is clear the conflict between economic growth and environmental protection is coming to a head."

Economic growth has been responsible for much of Asia's environmental disaster?but it can also spur its recovery. For as a nation such as South Korea shows, growth can give rise to environmentalism, as richer citizens demand that government and industry clean up. But Asia can't wait for the invisible hand to grow a green thumb; its problems are too intractable for that. Asia's future has to become one of sustainable "green growth," which protects and repairs the environment without hindering the economic development that remains a matter of life and death for too many. Improved environmental technology can help developing Asia become as efficient in cleaning up pollution as it is in creating it, but only if the commitment is made before we pass the point of no return. "I feel that every day is a race," says Barbara Finamore, director of the China Clean Energy Program at the Natural Resources Defense Council (NRDC), a U.S. NGO. "It's a race to the death."

Ask five Asian experts to identify the region's most pressing environmental problems, and you'll get five different answers. Alex Wang of the NRDC says it's air and water pollution. For Elsie Cezar of the Philippines' Environmental Management Bureau, it's waste disposal and deforestation. World Wildlife Fund Cambodia's Teak Seng tags the illegal wildlife trade. All those problems have something in common: what makes them worse is what's making Asia richer. Take deforestation in Indonesia, which loses almost 2 million hectares of woodland a year. As China's economy has surged, so has its demand for timber?the country is now the destination for half of all tropical trees logged globally. In April, Indonesia announced that China had placed a $1 billion order for more than 700,000 cu m of a special hardwood tree to be used in constructing facilities for the Olympics. That lumber, at least, will be legal?a recent report by Greenpeace named China's booming furniture industry as the engine of worldwide illegal logging, although the developed countries that eagerly buy China's low-cost chairs and tables share the blame. At the current rate, Indonesia's lowland rainforests, home to the most diverse collection of trees on earth, could vanish forever by 2010.

Indonesia is a poor nation that needs the billions China sends its way, just as China needs the funds its furniture factories bring in. "The mentality is still that development should be put in front of the environment," says Jayaradha Veerasamy of the Malaysian Nature Society. But the hidden costs of environmental degradation can be catastrophic?nowhere more so than in natural disasters that have become increasingly common in Asia. The impact of climate change on the frequency and intensity of storms is still uncertain; but there's no doubt about other facts that worsen natural disasters. Deforestation can make devastating landslides more common, just as the destruction of coral reefs and underwater mangrove forests stripped coastlines of a vital defense against the 2004 tsunami. Without better preparation of the sort Japan perfected against natural disasters, death tolls will only rise as urbanization packs formerly rural populations into areas more vulnerable to earthquakes, floods and storms.

But economic growth may also create a solution by turning environmentalism into a valued consumer good. Just as richer people want more cars, TVs and air conditioners?all of which lead to more pollution?they also want air that doesn't make their children asthmatic, and water that might even be drinkable out of a tap. Economists have a term for it: the environmental Kuznets Curve, which hypothesizes that once per-capita incomes reach a certain level?in some past examples, around $5,000?pollution levels begin to plunge, as they did in once-filthy cities like London and Los Angeles. "You have the phenomenon of people with higher incomes feeling inconvenienced by pollution and wanting the government to spend money to fix it," says Finamore. If it happened in Tokyo in the '70s, it can happen in Bombay some time in the next couple of decades.

Pessimists will say that even at their current torrid rates of growth, it will take decades before nations like China and India are rich enough to decide they want to be clean?and by then the damage may be irreversible. The good news is that today's Asians may not have to wait that long. Contemporary antipollution and energy-efficiency technology is far superior to that used in the West's first cleanups. If developing Asia commits soon to investing in environmentally friendly policies and technology?clean coal plants, efficient water pricing, natural gas-powered bus transit?the region could take a green leap forward. To be sure, that will require serious investment from those developing advanced technologies in the rich world, but the scale of Asia's environmental challenges is so immense that everyone has a stake in its success. The pump is already primed: in August the World Bank brokered the largest ever greenhouse-gas contract, which will see European and Asian organizations pay two Chinese chemical firms $1 billion to reduce carbon dioxide emissions by 19 million tons a year. "There's a paradigm shift beginning to manifest itself in Asia's environmental policy," says Cornie Huizenga, who heads the Clean Air Initiative for Asian Cities for the Asian Development Bank and World Bank. "You're starting to see investments shift as well."

Carbon credits alone will not buy a better environment for Asia. A revolution in awareness must be embraced by the individual, with inspirational Asians leading the way, like Tsering Dorje, the Tibetan activist fighting the illegal wildlife trade, or Vu Thi Quyen, who founded Vietnam's first homegrown environmental group. Those efforts can be multiplied by the growth of established environmental NGOs. India is blessed with some of the best organizations, like Sunita Narain's Centre for Science and the Environment, but even in China environmental groups are expanding in fits and starts. Politicians, too, must play their part, making sure that a commitment to a new sort of growth is taken seriously from the halls of government ministries right down to tiny villages.

Yale University's Center for Environmental Law and Policy recently ranked nations on environmental performance and found that good governance was even more important than income. That's one reason why highly regulated Singapore has proven far better at combating pollution than laissez-faire Hong Kong. It also means that China, which will really decide the future of Asia's environment, needs to match its bold national goals with local follow-through?something it has conspicuously struggled to do so far. "There's that old adage in China that the mountains are high and the emperor is far away," says Dan Dudek, chief economist for Environmental Defense. China's growth-obsessed, corner-cutting local governments cannot be allowed to drive the country's environmental policy.

Some days?when the air is heavy in Hong Kong and the gridlock is choking Jakarta?it seems to take optimism bordering on willful ignorance to feel positive about the future of Asia's environment. But other nations, including Asian ones, have faced down pollution and come clean. There are times, and places?everyone who lives in Asia has known them?when it seems it will take a miracle to save the region's environment. It wouldn't be Asia's first.

• Bryan Walsh
• After decades of rapid economic growth, Asia's environment is at a tipping point. A Special Report on the scale of the crisis—and how to confront it