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Typically, peri-urban areas are havens and vulnerable receptors of customary land rights (CLRs) disputes due to the intrusion of urban activities or an uncoordinated mix of both. Although it is a dictum that CLRs cause setbacks to socioeconomic and spatial development, there seems to be a paucity of empirical studies on the effects of the CLRs disputes on the development of peri-urban areas, especially in developing countries, such as Ghana. This study addresses this issue by establishing a link between peri-urban transformation and emerging CLRs disputes, while assessing the effects of these disputes on the development of peri-urban areas. The study adopted a problem-centered mixed methods approach with a focus on the case of Trede, a town in Ghana transitioning from rural to urban status. Findings reveal that the changes leading to enhancing of peri-urban transformation are also the same changes inducing CLRs disputes in the area. It was found that the implementation of a local land use plan is a critical driver of CLRs disputes in Trede. A land-use plan implemented as a major step in converting rural lands into urban plots, triggered tenurial changes, land market development, high land values, loss of agricultural land, etc., which become recipes for the CLRs disputes in the study area. These CLRs disputes have hatched detrimental consequences on the economic, social, and physical developmental trajectories of Trede. As a way forward, the study proposes measures for peri-urban land management and CLRs dispute prevention.