<p>Reducing spatial inequality has been a central objective of Morocco’s Advanced Regionalization Project since 2015, yet regional disparities persist and continue to deepen. The twelve Moroccan regions evolve at different speeds, reflecting the enduring effects of core–periphery structures, path dependence, and spatial lock-ins that channel resources toward coastal growth poles while constraining peripheral territories. This research investigates the mechanisms behind these unequal trajectories, focusing on how demand-side welfare gaps, investment efficiency, and localized institutional capacity shape spatial inequality across regional, provincial, and municipal levels. Using spatial econometric estimation combined with nighttime-light data as a proxy for economic activity, the study reveals that while urban consumption and population concentration drive growth in illuminated cores, investments fail to generate inclusive spillovers. These structural imbalances reinforce geographic polarization and undermine the goals of territorial cohesion and social equity. Results reveal that growth and light intensity are concentrated in illuminated cores where consumption and population density reinforce cumulative advantages, whereas investment shows weak spillover capacity and often amplifies the core–periphery divide. These findings demonstrate that inequality in Morocco is not solely an income outcome but a manifestation of spatially embedded development structures and governance asymmetries. The evidence calls for a reorientation from uniform, top-down policies toward place-based strategies that leverage local potential, strengthen institutional capacity, and promote inclusive investment. Beyond Morocco, the analysis offers insights for developing countries facing similar spatial divides, highlighting the need for territorially sensitive approaches to achieve the SDGs on decent work, reduced inequalities, and sustainable cities.</p>