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This paper is part of the special issue of European Environment devoted to the outputs of the EU SRDTOOLS project,1 which developed and applied a new model of regional sustainable development evaluation. The paper introduces the concept and framework of the four-capital model, which was used in the project. First it discusses some issues around sustainable development evaluation, before introducing the theory of the four-capital model. It then describes how indicators can be used to evaluate programmes such as those financed by the EU Structural Funds against criteria for sustainable regional development in terms of the four capitals. An ‘ideal’ indicator set is listed in the appendix. Copyright © 2007 John Wiley & Sons, Ltd and ERP Environment. [ABSTRACT FROM AUTHOR]