Organized Industrial Districts are important regional development tools that have been extensively utilized by the Turkish authorities as part of Turkish industrialization program, with varying degrees of success. The empirical part of the study is carried out in Ankara, Sincan Industrial district. The study investigates the intra- and inter-firm relationships, and its possible implications for firm level innovation activity. In the first stage of this study, the purpose is to explore vertical I/O (input-ouput) interfirm links and social relations. For this end, a survey is employed to 86 firms engaging in machinery and equipment sector. 79 firms reported innovation activity. In the second stage, the target is to reveal the determinants of innovative activities. Two general findings are noteworthy. First, the existing interfirm relations and other social relations are not well-established for achieving successful innovations rather they hinder the possibilities for success. Second, the determinants of product and process innovations are different as envisaged at the beginning of the study.