Predicting Consequences and Reinforcing Navigation Policies with Latent World Models

World models enable agents to reason about future outcomesand learn policies from their knowledge of state transition, but existingapproaches primarily focus on reconstructing future observations or fea-tures, which introduces unnecessary complexity and limits their effec-tiveness for decision making. In this work, we propose a compatibilityprediction Latent World Model (LWM) for robot navigation that pre-dicts action-conditioned latent feature compatibility rather than recon-structing observations. Our key insight is that spatial proximity corre-lates with latent feature similarity, enabling action consequences to beevaluated directly in latent space. To support counterfactual training,our model leverages action sequences sampled across trajectories andlearns to predict which sequences lead closer to the goal. Furthermore,we demonstrate how the learned world model can supervise policy learn-ing from unlabeled video data and further improve policies through re-inforcement learning entirely within the world model. This imagination-driven framework eliminates the need for action annotations and addi-tional environment interaction. Extensive experiments on multiple real-world robot navigation datasets show that our approach significantlyoutperforms prior world model and imitation learning methods in pre-diction accuracy, policy learning, and real-world navigation performance.The code, pretrained models, and additional materials are available athttps://wzm206.github.io/latent-world-model-nav/.