This study aims to develop more inclusive and sustainable waste management practices to be implemented in Bang Chalong Housing, a model community with unsatisfactory waste separation and recycling rate. The extended theory of planned behavior was employed to investigate the effect of attitude, subjective norm, perceived behavioral control, knowledge, and situational factors on household waste separation intention and behavior, using structural equation modeling as a tool. Based on the questionnaire responses of 321 residents, the house owner’s status exhibited a considerable impact on waste-sorting behavior. Knowledge (β = 0.653; p < 0.001) and subjective norm (β = 0.160; p < 0.05) were two significant predictors of the respondents’ intention, which showed a strong influence on household waste separation behavior (β = 0.804; p < 0.001). Various waste management scenarios were also evaluated through material flow analysis and life cycle assessment. Installing a waste-sorting plant in addition to the current approach (recycling and landfilling) could annually reduce 26.4 tons of solid waste from being landfilled and mitigate GHG emissions by up to 47.4 tons CO2 equivalent. Finally, the implications of these results on designing interventions and amending waste management schemes were discussed.