Abstract The performance of a wind turbine is directly affected by the site wind condition. In urban-built locality, the wind is typified by fluctuating velocity and direction, and high turbulence intensity (TI). This paper investigates the impact of turbulence intensity on micro wind turbine efficiency in converting the wind energy to power. The performance of bare micro wind turbine (MWT) and diffuser-augmented micro wind turbine (DAMWT) models subject to different level of turbulence intensities is reported. Turbulence intensities ranging from ≈2% to 29% were generated by means of turbulence grids. The turbine performance is assessed in terms of the relationship between the coefficient of performance, CP and tip speed ratio, λ. Computational fluid dynamics (CFD) simulations and wind tunnel tests show that shrouding the turbine with diffuser increases the peak CP by approximately two times. Beyond a certain tip speed ratio, the performance of both MWT and DAMWT is shown to decrease with turbulence intensity, however the Cp of the DAMWT is still greater than bare MWT wind indicating the diffuser augmentation is still achievable even at high level of freestream turbulence.