The primary aim of this article is to reprise the debate about the role and competence of the state in innovation and development, building on the contributions of new industrial policy. It then examines the experience of one of the most ambitious mission-led innovation programmes ever launched in Europe, the Smart Specialisation Strategy (S3) programme, which has been influenced by industrial policy ideas. The article also identifies a number of challenges facing the S3 programme, particularly in the less-developed regions of the European Union, where these challenges are most pronounced.