Increasingly, research of potential socio-economic value is being conducted within cross-sector (government, university, business) inter-organizational networks. Such networks encourage innovation and learning by breaking down rigidities in existing institutions and by providing for ‘knowledge creation in the context of application’. In the process, new organizational forms for research and development (R&D) are emerging. The Cooperative Research Centre (CRC) is the dominant organizational model for cross-sector collaborative R&D in Australia. Joining a cross-sector collaborative R&D centre poses a significant challenge for public sector research managers. Success depends on cooperation with businesses and other organizations whose interests, objectives, expectations and strategies at various times converge or conflict. The game is a risky one, with the possibility of unforeseen and unwelcome consequences such as partner opportunism and competition for resources. Yet little empirical evidence exists on how researchers perceive and manage the risks and rewards of participation in cross-sector R&D centres. Our study gives voice to the researchers within these inter-organizational networks. We draw evidence from a written survey of 370 respondents from public sector organizations involved in the management and conduct of CRC-based research. The survey questions permit an assessment of the main benefits and problems in CRC participation; the management strategies adopted; and the effect of CRC participation on careers. Responses to open-ended questions in the survey convey the ‘CRC experience’ in the participants own words. We find the concepts of risk common in the management and organizational studies literature inadequate to explain the dynamics of interaction in cross-sector R&D. We therefore extend these through notions of the domains of ‘academic’, ‘scientific’ and ‘organizational’ risk. There are two broad implications of our findings: (1) participants in the CRC need to look beyond the traditionally acknowledged risks of contractual arrangements and consider risks that relate to the nature of scientific knowledge structures and the actual concerns and careers of research scientists; and (2) once these ‘academic’ and ‘scientific’ considerations are properly assessed, government research agencies and universities may need to adopt different management responses to their participation in inter-organizational R&D. We speculate that the way these potentially competing domains are dealt with has implications for (1) the survival of individual CRCs and (2) whether cross-sector collaborative R&D organizations remain ephemeral ‘staging posts’ or become entrenched in the national research system. We argue that cross-sector collaborative R&D organizations are an important component of a dynamic ‘science system’, but that they are inherently unstable organizations. They require organizational management that recognises their differences from business IORs that involve firms alone.