The British artist Mike Nelson generally does not work with precious materials. Weathered wooden doors, grease-caked kitchen utensils, dust respirators: These are the tools of the installation artist’s trade. But Mr. Nelson is now displaying the result of his use of perhaps the most valuable commodity in Manhattan—space, specifically 16,000 square feet of usable space in an abandoned building in the Essex Street Market in the Lower East Side. His installation “A Psychic Vacuum” is open to the public through October 28.

“A Psychic Vacuum” is an intricate series of small rooms, each outfitted to resemble the kinds of businesses that once dominated the Lower East Side — tattoo parlors, storefront psychics, a Chinese restaurant. Visitors make their way through the labyrinth, eventually emerging into a large, high-ceilinged space in which Mr. Nelson has constructed a giant sand dune. “Mike often produces installations that move you from space to space in a cinematic way; they jump you,” a co-curator of the project, Nato Thompson, explained. “The trick is seducing you into believing you’re in a space you’re not in.”

Mr. Nelson, 41, is known widely in Europe for his site-specific, large-scale installations at the Venice Biennale (2001) and the Istanbul Biennial (2003). He is currently on the short list for Britain’s prestigious Turner Prize, former winners of which include such name-brand artists as Damien Hirst, who showed his “Mother and Child, Divided” (a cow in formaldehyde) to win the prize in 1995, and Chris Ofili, whose work incorporating elephant dung helped spur reaction to the Brooklyn Museum’s “Sensation” show in 1999. Mr. Nelson was previously nominated for the Turner in 2001. But he has never had a major show of his work in America, and has declined previous invitations to work in New York because of a lack of suitable raw spaces.

But Building D of the Essex Street Market — abandoned for the past 13 years, now under the control of the city’s Economic Development Corporation, and long eyed by developers — provided Mr. Nelson with the opportunity he was looking for. It was being offered by Mr. Nelson’s “first choice of people to work with”: Creative Time, a nonprofit organization that frequently uses abandoned or unclaimed spaces for art projects.

Building D had over a decade worth of grime and a healthy nocturnal rat population, the kind of character from which Mr. Nelson’s often detritus-filled spaces benefit.

And it had a ticking clock. The EDC is expected to put out a request for proposals to develop Building D and another building, B, both located in the retail and commercial development-heavy Lower East Side. Mr. Nelson said the space’s location in a transitional neighborhood and its impending conversion lent it a provisional appeal.

“It’s an equation of sorts,” the artist said of his search for suitable workspace.

For Creative Time officials, the property was an obvious choice for Mr. Nelson’s work. “You spend a couple of years doing this kind of thing, and you start having an eye for real estate,” a curator of the work, Peter Eleey, said. As a curator at Creative Time (he has since taken a job at the Walker Art Center in Minneapolis), Mr. Eleey initiated the organization’s collaboration with Mr. Nelson after seeing his work in Istanbul in 2003.

Though Mr. Nelson’s publicly oriented practices appeared an obvious fit for Creative Time’s mission, his need for space proved the one hurdle to bringing him to New York. “In this case we were lucky because the building is a city-owned property, and the city is a partial landlord,” Mr. Eleey explained, referring to the Bloomberg administration’s willingness to consider alternative uses for public property.

But for all of the significance the location of Mr. Nelson’s work demands, the installations themselves are often intended to repudiate their surroundings. The softspoken Mr. Nelson compared the experience of walking through one of his works to being engrossed in a novel. “Take a fantasy on the high seas,” he said, scratching his bushy, gray-flecked beard. “You’re not there, but, at some point, you’re lost reading it. A viewer will make a decision to accept your narrative. In a museum, it’s much more clear-cut; you know where the trickery is going on.”

Mr. Nelson gestured to the enormous undulating wooden structure encased by chicken wire that will serve as the skeleton for the dune. “It’s more like still-life,” he said. “You don’t know what it will be until its there.”

Such a mentality has, however, proved somewhat tricky for those with budgets and deadlines on the mind. Days before the show’s opening date, the 75 tons of sand Mr. Nelson had ordered for his dune had not yet arrived, and the artist and his assistants were regularly working late enough to encounter the building’s rodent population. Mr. Thompson, though, expressed no surprise. “Mike’s the kind of artist where you tuck in the corners at the last second.”

Until October 28 (117 Delancey St. at Essex Street, 212-206-6674).