This study investigates the dynamic relationship between greenhouse gas (GHG) emissions, GDP per capita, and urbanization in Malaysia from 1990 to 2020, employing a Vector Autoregression (VAR) model and Impulse Response Function (IRF) analysis. The results indicate that Malaysia’s economic growth initially contributes to increased GHG emissions, supporting the Environmental Kuznets Curve (EKC) hypothesis, which postulates a rise in environmental degradation during early stages of growth, followed by a decline as income levels increase. Specifically, the study found that a positive shock to GDP per capita initially leads to a reduction in emissions, likely reflecting Malaysia’s adoption of cleaner technologies and stricter environmental regulations. However, sustained economic growth may result in emissions rising again, highlighting the importance of balancing industrial expansion with sustainability efforts. Urbanization, while positively influencing GDP, shows a limited and inconsistent impact on emissions, suggesting that its environmental effects depend on policy measures guiding urban development. These findings highlight the need for continued investments in green technologies and sustainable urban planning to ensure that Malaysia’s growth remains aligned with its environmental commitments.