In sub-Saharan Africa, reported COVID-19 numbers have been lower than anticipated, even when considering populations’ younger age. The extent to which risk factors, established in industrialised countries, impact the risk of infection and of disease in populations in sub-Saharan Africa, remains unclear. We estimated the incidence of mild and moderate COVID-19 in urban Mozambique and analysed factors associated with infection and disease in a population-based surveillance study. During December 2020-March 2022, 1,561 households (6,049 participants, median 21 years, 54.8% female, 7.3% disclosed HIV positive) of Polana Caniço, Maputo, Mozambique, were visited biweekly to report respiratory symptoms, anosmia, or ageusia, and self-administer a nasal swab for SARS-CoV-2 testing. Every three months, dried blood spots of a subset of participants (1,412) were collected for detection of antibodies against SARS-CoV-2 spike glycoprotein and nucleocapsid protein. Per 1000 person-years, 364.5 (95%CI 352.8–376.1) respiratory illness episodes were reported, of which 72.2 (95%CI 60.6–83.9) were COVID-19. SARS-CoV-2 seroprevalence rose from 4.8% (95%CI 1.1–8.6%) in December 2020 to 34.7% (95%CI 20.2–49.3%) in June 2021, when 3.0% were vaccinated. Increasing age, chronic lung disease, hypertension, and overweight increased risk of COVID-19. Older age increased the risk of SARS-CoV-2 seroconversion. We observed no association between socio-economic status, behaviour and COVID-19 or SARS-CoV-2 seroconversion. Active surveillance in an urban population confirmed frequent COVID-19 underreporting, yet indicated that the large majority of cases were mild and non-febrile. In contrast to reports from industrialised countries, social deprivation did not increase the risk of infection nor disease.