Nanomaterials are seen as a key technology for the 21st Century, and much is expected of them in terms of innovation and economic growth. They could open the way to many radically new applications, which would form the basis of innovative products. In this context, it seems all the more important for regions to put their own innovation systems in place, and to ensure that they offer a suitable location for such activities in order to benefit from the expected growth. Many regions have already done so by establishing ?science parks? and ?nanoclusters?. As nanomaterials are still in their infancy, both public research institutes and private businesses could play a vital role in the process. This paper investigates what conditions and configurations allow a regional innovation system to be competitive in a cutting-edge technology like nanomaterials. We analyse European Patent Office data at the German district level (NUTS-3) on applications for nanomaterial patents, in order to chart the effects of localised research and development (R&D) in the public and private sector. We estimate two negative binomial models in a knowledge production function framework and include a spatial filtering approach to adjust for spatial effects. Our results indicate that there is a significant positive effect of both public and private R&D on the production of nanomaterial patents. Moreover, we find a positive interaction between them which hints at the importance of their co-location for realising the full potential of an emerging technology like nanomaterials.