Innovations are usually conceived as new technical products aimed for commercial markets. However, the interest for innovations in the public sector is increasing and accompanying this interest follows a need for deeper knowledge about public sector innovation. A co-learning program among public sector organisations has been carried out in order to enhance innovation knowledge among public administrators. One of the main ideas of this learning program is that members from one organisation study innovation work in another organisation and then share their learnings to all participants of the learning program. In order to conduct such an inquiry the participants have used different innovation concepts structured in an innovation model. This supportive knowledge has been framed as a practical theory (following pragmatist epistemology) in this paper. The paper presents how this practical theory on public sector innovation has been continually improved during the learning program. The practical theory consists of three parts: An innovation concept, a description of the innovation process and the innovation context (internal and external preconditions). The development of the practical theory has been done following principles of multi-grounding (theoretical grounding, empirical grounding and internal grounding).