In this article we trace changes in the institutional and social dynamics that have steered cross-sector R&D collaboration in Australia. Public policy provided the initial push toward cross-sector collaboration. The Cooperative Research Centres (CRC) Program is Australia's most longstanding national arrangement for industry-university-government research collaboration. Over the past two decades the program has grown to become the dominant model for cross-sector R&D cooperation in the country. Because of the size of the program in the Australian innovation system it has also become a major focus for debate about science policy. Universities have now institutionalised this imperative in all sorts of ways that steer research funding and career opportunities for their academic staff. Expectations and aspirations of CRC staff, doctoral students and potential staff and students are now deeply embedded in centres' evolutionary processes.