As China’s urbanization development direction has shifted from incremental construction to upgrading existing structures, urban renewal has become an important planning approach, and the gradual micro-renewal model has become a key trend for residential area transformation. Additionally, the local renewal approach focusing on public spaces of residential areas is becoming a new way to enhance the quality of urban public spaces, stimulate urban vitality, and promote sustainable development of regions. Currently, due to the long building years and other factors, old communities have insufficient public facilities, parking difficulties, outdated facilities, and other problems, making it difficult to meet the needs of residents’ lives. This paper takes Baizhifang Street in Xicheng District as an example and starts from the meaning of participatory design, respecting the existing environment and policies in China, discussing the public space problems, selecting the renewal area and formulating design strategies, and finally showcases the actual application of the design in public space renovation.