This chapter explains the algebraic construction of toroidal compactifications. For this purpose the chapter utilizes the theory of toroidal embeddings for torsors under groups of multiplicative type. Based on this theory, the chapter begins the general construction of local charts on which degeneration data for PEL structures are tautologically associated. The next important step is the description of good formal models, and good algebraic models approximating them. The correct formulation of necessary properties and the actual construction of these good algebraic models are the key to the gluing process in the étale topology. In particular, this includes the comparison of local structures using certain Kodaira–Spencer morphisms. As a result of gluing, this chapter obtains the arithmetic toroidal compactifications in the category of algebraic stacks. The chapter is concluded by a study of Hecke actions on towers of arithmetic toroidal compactifications.