The public service modernization agenda has directed attention to the problematic questions of how public sector organisations learn, what they learn, and how they fail to learn. This article considers: definitional problems of organisational learning; the critical differences between individual and organisational learning; the public organisation's capacity to learn; some of the principal sources of public sector learning; the ambivalent nature of learning networks; and the main barriers to effective learning. Drawing from a current study amongst senior public service managers, the discussion assesses the extent to which public service modernization encourages, or rather inhibits, organisational change and improvement. It is suggested that organisational learning in the public sector is not necessarily delivered through partnerships and the agenda of modernization: it may derive instead from internal processes and a focus upon the existing strengths of the organisation. The article re-evaluates the conventional wisdom of organisational learning and proposes a heretical view of learning and networks. In drawing out prospects for future research, it advocates a renewed emphasis upon effective internal learning.