This article explores the role of labour mobility as a potential cluster advantage. We review the theoretical arguments as for how and why labour mobility could enhance the dynamism and performance of clusters of similar and related firms. A combination of quantitative and qualitative data from two information and communication technology (ICT) clusters is used to answer two research questions: (1) What is the role of mobility enhancing (or restricting) institutions in clusters? and (2) In what ways does labour mobility contribute to knowledge transfer within clusters? The two ICT clusters studied in the article generally seem to have higher levels of mobility, compared to the labour market at large. Although it is regarded as beneficial in theory, most cluster firms try to restrict mobility of workers since they fear the risk and costs of losing staff. Labour mobility is also rarely viewed as a viable way to increase the knowledge bases or contact networks of firms. However, when firms need to recruit the clustered labour markets seem to benefit them by facilitating the use of informal recruitment processes. By way of conclusion it is suggested that cluster firms might be under-investing in mobility and that innovative institutional solutions could help realize clusters mobility potential.