This paper introduces a new methodology for the development of appropriate technology that allows satisfying energy needs in rural communities. The methodology integrates the technological development, taking particularly into account the assessment of environmental impacts as well as evaluation of the functionality of the technology. Therefore, it is implemented as a case study in the development of a solar wood-dryer in an artisan community in Mexico. Relevant issues were identified for the success of the methodology, which includes identifying key participants in the community, as well as the use of specialized simulation- and computer-based design tools, and a prior evaluation of the potential environmental impacts through Life-Cycle Assessment (LCA) of the solar wood-dryer. Three geometries of a solar wood-dryer prototype were proposed and analyzed with computer-based simulations, which showed better interior heat transfer than the traditional wood brick-dryer. LCA revealed that the new solar wood-dryer prototype has environmental impacts in all analyzed categories that are 5% or smaller than those of the traditional dryer. Therefore, it was demonstrated that the solar wood-dryer developed with our introduced methodology leads to less environmental impacts compared to those of the traditional wood brick-dryer previously used by the rural community.