Social interactions between parents and children are important for developing theory of mind, but these may be disrupted by aspects of the proximal home environment. The current study observed maternal sensitivity and its associations with child theory of mind and the housing environment (index by clutter and crowding) in a sample of mothers and their 3.5-year-old twins (N = 250 children). Maternal sensitivity and housing environment were measured from experimenter report and child theory of mind was measured through behavioural tasks. Results show that the association between maternal sensitivity and child theory of mind was moderated by the housing environment, where the positive associations between maternal sensitivity and child theory of mind were only observed at lower levels of clutter and crowding in the housing environment. Additional contextual variables and processes are discussed.