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The knowledge industry has an important function for regional economic development in cities and countries with strong knowledge economies. This study examined the characteristics of clustered Knowledge Intensive Business Services (KIBS) in the Tokyo Metropolitan Area and investigated the determinants of these enterprises’ locations. Using municipal‐level data, the significance of the determinants of KIBS’ locations was tested in a path analysis, followed by analysis of questionnaire survey data on KIBS enterprises. The results were as follows. First, several dense KIBS agglomerated clusters were found in central Tokyo and some inner‐suburban business districts. Ellison‐Glaeser index statistics confirmed that KIBS were more likely than non‐KIBS to geographically concentrate. Second, the most influential determinants of KIBS’ location were urban economies, food amenities, and nightlife amenities. The result of the questionnaire survey also implies that, in highly urbanized areas, a dense distribution of business enterprises, food and nightlife amenities, and sophisticated urban regional image creates a positive urban environment evaluation by KIBS enterprises and attracts them through direct and indirect causal relationships.

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