The present research aims at investigating the effects of Afghans’ informal settlement in the villages located near Sistan and Afghanistan border in the southeast of Iran. It was attempted to identify the relationship between the levels of development of villages with Afghan informal settlers with the number of Afghan immigrants per village. The study was conducted in 31 villages located in Sistan border area in the southeastern corner of Iran. The study is based on an analytical-correlational research design using library resources, field observations, and questionnaire survey data. The collected data were analyzed using taxonomy method and Spearman correlation on SPSS. The results of the taxonomy classification showed that out of the 31 villages under study, six villages were at a favorable development level and the other 25 villages were at lower levels of development. Moreover, the results of Spearman test at a confidence level of 99% revealed a reverse relationship between Afghans’ settlement and physical development (−.845) of villages, that is as the number of Afghans increased, the development level of villages decreased and vice versa. Overall, the results indicate that due to immigration from an underdeveloped country such as Afghanistan with an underdeveloped social culture and their lack of sense of belonging to Iran, Afghan immigrants who are residing in the eastern border areas of Iran negatively influence the physical development of their immediate rural environment.