Paraterraforming (also known as the "worldhouse" concept or domes in smaller versions) involves the construction of a habitable enclosure on a planet which eventually grows to encompass most of the planet's usable area. The enclosure would consist of a transparent roof held one or more kilometers above the surface, pressurized with a breathable atmosphere, and anchored with tension towers and cables at regular intervals. Proponents claim worldhouses can be constructed with technology known since the 1960s. The Biosphere 2 project built a dome on Earth that contained a habitable environment. The project encountered difficulties in operation, including unexpected population explosions of some plants and animals, and a lower than anticipated production of oxygen by plants, requiring extra oxygen to be pumped in.

Paraterraforming has several advantages over the traditional approach to terraforming. For example, it provides an immediate payback to investors (assuming a capitalistic financing model). Although it starts out in a small area (a domed city for example), it quickly provides habitable space. The paraterraforming approach also allows for a modular approach that can be tailored to the needs of the planet's population, growing only as fast and only in those areas where it is required. Finally, paraterraforming greatly reduces the amount of atmosphere that one would need to add to planets like Mars to provide Earth-like atmospheric pressures. By using a solid envelope in this manner, even bodies which would otherwise be unable to retain an atmosphere at all (such as asteroids) could be given a habitable environment. The environment under an artificial worldhouse roof would also likely be more amenable to artificial manipulation. Paraterraforming is also less likely to cause harm to any native lifeforms that may hypothetically inhabit the planet, as the parts of the planet outside the enclosure will not normally be affected unlike terraforming which affects the entire planet.

It has the disadvantage of requiring massive amounts of construction and maintenance activity. It also would not likely have a completely independent water cycle, because although rainfall may be able to develop with a high enough roof, but probably not efficiently enough for agriculture or a water cycle.[citation needed] The extra cost might be off-set somewhat by automated manufacturing and repair mechanisms.[citation needed] A worldhouse might also be more susceptible to catastrophic failure if a major breach occurred, though this risk might be reduced by compartmentalization and other active safety precautions. Meteor strikes are a particular concern because without any external atmosphere they would reach the surface before burning up.

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