The quality and quantity of natural light entering a building depends on both internal and external factors. In Hong Kong, many buildings are, high-rise blocks constructed close to each other and hence the external factor plays a significant role in daylighting designs. This paper studies the daylighting performance and energy use for residential flats facing large sky obstructions via computer simulations. Key building parameters affecting daylighting designs are presented. The daylighting performance for typical interior rooms was investigated in terms of illuminance level and daylight factor. The daylight levels of residential flats can be severely reduced by neighboring buildings and hence the externally reflected component would be the main source of natural light. The indoor daylight levels for kitchen and living/dining faced large neighboring building were found always less than the standard maintenance illuminance during daytime period. These imply that many residential flats in Hong Kong would have to rely on supplementary electric lighting. (c) 2006 Elsevier B.V. All rights reserved.