Understanding the innovation ecosystem is essential to science, technology and innovation policy decision-making. This paper analyses the impact of collaboration relationships between the Triple Helix spheres on the innovation performance of Palestinian industrial firms. A quantitative approach was used by employing the Generalized Linear Model (GLM) to analyze data gathered from 340 industrial firms in the West Bank. The results showed that industrial collaboration as per the Triple Helix Model is very weak and its impact on the ability of the industrial firms to introduce new technological innovation is not significant. Similar results were found for non-technological innovation, with a staggering negative relationship regarding the marketing innovation. Therefore, there is an urgent need to develop an innovation policy framework to address the above challenges. This study attempts to put forward key recommendations in this context. Further in-depth analysis will be conducted in future studies, including cross-sectors, firm size and rate of innovation.