In the emerging knowledge economy, universities are adopting a key role as producers of scientific knowledge and skills, and they are experiencing far reaching changes in their tasks. Their main mission is no longer confined to education and research, but increasingly also covers technology transfer and commercialisation activities. The aim of this paper is to examine to what extent this phenomenon could also be observed in Austria, a country which is not a pio-neer regarding the development of the knowledge economy. Moreover, we are interested in the particular mechanisms of knowledge transfer. We differentiate between four key tasks of uni-versities, including their roles as ―antennae‖ for receiving external knowledge, sources of highly skilled labour, cooperation partners for the industry and seedbeds for new firm formation. Fo-cusing on the biotechnology sector we will demonstrate that an opening of the ivory tower and a move of Austrian universities towards the market place has occurred. Furthermore, we will show that these changes to some extent have been policy-driven in nature.