Research collaboration is generally motivated by quality enhancement. The networks underlying collaborative knowledge production also serve as vehicles of knowledge diffusion. Both aspects are expected to contribute to the citation impact of publications. We analyse knowledge production in European biotechnology for the period 1988–2002 focusing on the role of research collaboration. Different aspects of research collaboration are taken into account simultaneously to assess their relative importance. We distinguish between the number of contributing authors and addresses as to differentiate between the effect of the collaboration between individuals and between organizations. We further distinguish between different spatial scales of collaboration (national, European, international) and between different institutional types of collaboration (between academia, outside academia, and hybrid). We find evidence that the diffusion of scientific knowledge, as measured by citation rate, is dependent on both intra- and inter-organisational characteristics. An important finding has also been that the further differences in citation impact can be related to the geographical scale of collaboration with the European scale being most successful. Furthermore, country-fixed effects suggest that the European Union, though successful as a geographical scale of collaboration, still harbours many national varieties of knowledge production.