Integration of low-cost air quality sensors with the internet of things (IoT) has become a feasible approach towards the development of smart cities. Several studies have assessed the performance of low-cost air quality sensors by comparing their measurements with reference instruments. We examined the performance of a low-cost IoT particulate matter (PM10 and PM2.5) sensor in the urban environment of Santiago, Chile. The prototype was assembled from a PM10–PM2.5 sensor (SDS011), a temperature and relative humidity sensor (BME280) and an IoT board (ESP8266/Node MCU). Field tests were conducted at three regulatory monitoring stations during the 2018 austral winter and spring seasons. The sensors at each site were operated in parallel with continuous reference air quality monitors (BAM 1020 and TEOM 1400) and a filter-based sampler (Partisol 2000i). Variability between sensor units (n = 7) and the correlation between the sensor and reference instruments were examined. Moderate inter-unit variability was observed between sensors for PM2.5 (normalized root-mean-square error 9–24%) and PM10 (10–37%). The correlations between the 1-h average concentrations reported by the sensors and continuous monitors were higher for PM2.5 (R2 0.47–0.86) than PM10 (0.24–0.56). The correlations (R2) between the 24-h PM2.5 averages from the sensors and reference instruments were 0.63–0.87 for continuous monitoring and 0.69–0.93 for filter-based samplers. Correlation analysis revealed that sensors tended to overestimate PM concentrations in high relative humidity (RH > 75%) and underestimate when RH was below 50%. Overall, the prototype evaluated exhibited adequate performance and may be potentially suitable for monitoring daily PM2.5 averages after correcting for RH.