The literature on Industrial Districts (IDs) has emphasised the importance of inter-organisational relationships within this specific production model. However, this stream of studies has given less attention to conceptualise models and define techniques to effectively manage such relationships. In the paper a theoretical framework is proposed to characterise the IDs as a kind of production systems, on which basis appropriate managerial guidelines can be derived. In particular, the framework focuses on the supply chain/s within an ID and describes them in terms of physical, technological, strategic, and organisational dimensions. The theoretical framework is intended to help IDs, particularly the leader firms, better understand the whole production process so as to enhance the process performance. A case study of an Italian I D localised in Southern Italy is then discussed to validate the framework. (C) 2002 Elsevier Science B.V. All rights reserved.