Industrial symbiosis (IS) has emerged as a body of exchange structures to progress to a more eco-efficient industrial system, by establishing a collaborative web of knowledge, material and energy exchanges among different organizational units. However, even given the potential economic and environmental benefits derived from IS networks, the process of emergence and development of these networks seems far from straightforward. The effective operation of such networks relies heavily on aspects such as trust and general reciprocity, aspects insufficiently covered in the IS literature. Based on the theoretical framework provided by social network analysis and economic geography and the empirical data collected through qualitative methods, based on the approach of Grounded Theory, the authors propose a modelling framework to analyse the main mechanisms in the building of trust and embeddedness and identify different phases in cooperation leading to effective IS exchanges. Copyright © 2010 John Wiley & Sons, Ltd and ERP Environment.