The seldom studied intersectoral research and development relationship between public research centers -universities and public research organizations- and private organizations has a number of implications for each of these partners. In this paper we investigate this relationship with respect to their performance. A study of over 150 of these projects, funded by Spanish government agencies, is presented in this paper. We investigate, through empirical means, how participating firm characteristics, the R&D project itself, and the intersectoral relationship, influence project performance. A series of hypotheses are presented and discussed. Performance is determined using a DEA-based model and integrated with regression analysis to evaluate the various hypotheses.