Connecting occupants to the outdoor environment and incorporating biophilic design principles are challenging in extreme Arctic climatic conditions. Existing Arctic housing models do not provide efficient thermal and daylight transitions which are essential for the well-being and cultural needs of their occupants. To address these challenges, this research develops free-running biophilic intermediate spaces, integrated into an existing Arctic housing model. Numerical simulation methods are employed to optimize the primary and secondary architectural design variables for 26 case studies of intermediate spaces. Primary variables include volume, transparency ratio, and orientation. Secondary variables include materials and physical adjacency. Temperature, Daylight Factor/Autonomy, and Energy Use are evaluated as performance indicators. Results reveal that free-running intermediate spaces with 6 meters depth and a transparency ratio above 50% provide efficient indoor–outdoor transitions regarding thermal, visual, and energy performance. Such architectural configurations contribute to an approximately 5% reduction in energy consumption within the housing unit compared to the baseline. Opening side windows prevents the risk of overheating during the summer by reducing the average indoor temperature of intermediate spaces by 7 ℃ but increases the overall energy consumption. As a potential alternative to double-glazing, polycarbonate sheets enable efficient thermal performance by increasing the average indoor temperature of intermediate spaces by approximately 15 ℃ during the cold Arctic seasons. Using polycarbonate sheets results in a 16.6% reduction in energy consumption compared to using double-glazing material in intermediate space, and a 26% reduction from the baseline. Research outcomes contribute to efficient indoor–outdoor connections and energy efficiency in Arctic housing.