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Smart home technologies present an unprecedented opportunity to improve health and health care by providing greater communication and connectivity with services and care providers and by supporting the daily activities of people managing both mental and physical health problems. Based on our experience from conducting smart technology health studies, including a smart home intervention, we provide guidance on developing and implementing such interventions. First, we describe the need for an overarching principle of security and privacy that must be attended to in all aspects of such a project. We then describe 4 key steps in developing a successful smart home innovation for people with mental and physical health conditions. These include (1) setting up the digital infrastructure, (2) ensuring the components of the system communicate, (3) ensuring that the system is designed for the intended population, and (4) engaging stakeholders. Recommendations on how to approach each of these steps are provided along with suggested literature that addresses additional considerations, guidelines, and equipment selection in more depth.