Abstract: In 2011 Macquarie University completed a memorandum of understanding targeting development of a long-term, research-based partnership with its local government authority, Ryde City Council. This new relationship draws on the significant local knowledge resources of the Council’s professional staff, the research expertise of university staff and both institutions’ commitment to developing strong frameworks that support a strategic vision of sustainable local community. Of particular value is the university’s innovative student engagement program which facilitates longer-term research and service commitments. Drawing on this experience in Sydney, this paper reviews the issues affecting development of partnership between local governments and universities as more than conventional ‘town-gown’ relations. It concludes that governance and a scaled politics of local-global thinking need to be taken seriously by all parties in new generation partnerships.