According to a news release issued by MIT:

The basic framework of the house would be created using a gardening method known as pleaching, in which young trees are woven together into a shape such as an archway, lattice, or screen and then encouraged to maintain that form over the years. As the framework matured... the home grower would weave a dense layer of protective vines onto the exterior walls. Any gaps could be filled in with soil and growing plants to create miniature gardens. On the interior walls, a mixture of clay and straw beneath a final layer of smooth clay would provide insulation and block moisture.

Design-wise, I’m not sold -- the rendering looks like a bad amalgamation of Biosphere 2, Nicholas Grimshaw’s Eden Project, and a crash pad for the Keebler elves. But design isn’t the point here... as a fan of the project pointed out, the Fab Tree Hab could be tested as a way to build (er, grow) affordable housing in developing nations, especially in climates where trees grow rapidly. It’d be cheaper and more environmentally benign than trucking in concrete, steel, or (gasp!) virgin lumber. Who knows if their ideas will end up being feasible or cost-effective, but props to the MIT folks for pushing the envelope on how to build housing. Now if only they could show me how to keep plants alive in my light-starved apartment.