Street vendors influence the informal economy of low- and middle-income countries, as many customers depend on them for essential goods. Conventional top-down governance strategies often fail to address the distinct requirements of street vendors, resulting in policy inefficiencies and ongoing discord between vendors and municipal authorities. This qualitative research examines the collaborative, bottom-up governance framework of street vending in Bangkok, focusing on how inclusive governance may more effectively support informal economies. Data was gathered through comprehensive interviews with street vendors, municipal officials, and civil society representatives based on 28 stakeholder interviews and field observations. Results are that vendor-led initiatives have promoted communication among different stakeholders, helping to develop responsive, effective urban policies to increase vendor participation and equity. Bottom-up governance structures boost inclusivity and support sustainable urban development by addressing operator needs in the informal economy. Therefore, municipal authorities, street vendors, and stakeholders should adopt collaborative governance to enhance engagement and heed the voices of marginalised groups. In this way, the informal economy, urban equity, and sustainable economic growth will be bolstered, especially for low- and middle-income workers.