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In 1997 the law governing higher education and research in Sweden added a third task to the work to be done by the Swedish Universities: they were now no longer expected just to educate and to do research but also to relate to and collaborate with their local environment. The present article argues that this third task implies a new form of knowledge, viz., knowledge generated in interactive cooperation with practitioners. The change in the law has encountered resistance from the research establishment. However, there are good reasons for the universities to change from a position of noble seclusion towards continuous interaction with their environment. Three arguments are proposed that articulate the need to actively involve the world of practice in the research process. The National Institute for Working Life received an assignment from the government to promote the implementation of the universities ' third task. A program was started by approaching and involving primarily the 20 university colleges in networking and development activities. It seems that action-oriented, practice-based research can more easily find a foothold in these institutions. It cannot be denied that the third task has started to put new, challenging demands on the typical academic role.