With the development of the 'knowledge economy' in many advanced industrial nations, there has been a growing interest in regional innovation systems and the role that universities might play in these. One result has been the demarcation by government actors of specific spaces for the creation, transfer and transformation of knowledge. Such spaces have been given various names, such as 'smart regions', 'science cities' and 'innovation corridors'. Whilst the associated policy rhetoric has much in common with the earlier interest in science and technology parks there are also clear distinguishing differences. More recent policy initiatives have sought to foster industry clusters within these spaces to contribute to economic development and diversification and link this to economic, social and cultural regeneration. This paper explores policy-driven creation of 'innovation areas' by focusing on two contrasting examples: Newcastle Science City in the North East of England and the Gold Coast Pacific Innovation Corridor in Queensland, Australia. The paper compares the rhetoric of university-industry-government policies with the realities.