The study and simulation of the Urban Heat Island (UHI) and Heat Index (HI) effects in the Houston-Galveston metropolitan area demand special attention, particularly in considering moist processes aloft. During the warm season, the afternoon sea breeze phenomenon in this coastal city acts as a natural air conditioner for city residents, facilitating the dispersion of moisture, heat, and pollutants. To delve into the intricate relationships among urbanization, clouds, and land-sea interactions, we conducted cloud- and urban-resolving simulations at a 900 m grid resolution. Results show that urbanization correlates with the presence of shallow cumulus clouds, higher cloud bases, and increased cloud duration over the Galveston-Houston region compared to rural areas. These urban clouds benefit from the enhanced sensible heat and dynamic drag imparted by the urban landscape, thereby intensifying vertical mixing and moisture flux convergence. This dynamic interplay uplifts heat and moisture convergence, contributing to the enhancement of moist static energy that sustains the additional urban convection. Interestingly, our findings suggest that urbanization augments the mean HI while mitigating its afternoon high. An urban circulation dome emerges, overpowering the influence of land-sea circulations. Contrary to expectations, urbanization doesn’t seem to promote a stronger sea breeze that would favor moist and cooler air mass advection to the city. Instead, the influence of urbanization on cloud enhancement emerges as a crucial pathway responsible for reducing the afternoon HI values. Moreover, uncertainties in SSTs are closely linked to the sensitivities of land-sea circulations, which in turn modulate UHI and extreme heat indicators.