Abstract This study investigates how an incumbent company’s knowledge base influences its propensity to engage in technical cooperation. We analyze the effect of breadth, coherence and decomposability of the firm’s knowledge base on technological collaboration by taking the Chinese electrical & electronics firms during 2001~2008 as samples. The results show the breadth of the knowledge base has a significant positive influence on technology collaboration, while a inverted U-shaped relationship is found between the decomposability and the propensity to engage in technical cooperation. The findings of this research provide some suggestions to Chinese firms to improve their innovative competence.