Keywords: sectoral innovation system cluster public-private partnerships Dutch vegetable breeding industry a b s t r a c t In a number of studies, the Dutch vegetable breeding industry has been described as a highly innovative sector, but the root causes for its innovativeness have not yet been analysed systematically. In order to understand the factors that affect innovation and business performance, the Sectoral Innovation System (SIS) framework was used to analyse the linkages and interactions among the different actors in the Dutch vegetable breeding industry. Within SIS, five interacting domains are recognized and analysed: the business domain, the research & education domain, the intermediate organizations, the market demand, and the infrastructure & framework conditions, resulting in an integrated picture of the innovation system. It was found that the business domain, the research & education domain and the intermediate organisations do not only show an outstanding individual performance, but more importantly, they closely collaborate via public-private partnerships (PPP), research consortia, etc. It is shown that especially the cluster characteristics of the Dutch vegetable breeding industry, i.e. the geographical proximity and the high level of intra-and interconnectivity within and between domains, induces an intensive knowledge flow, a key indicator for the innovation level of a sector.