Although innovation is a critical issue for Small and Medium Enterprises (SMEs), the literature on how small wine firms implement innovation strategies is rather scarce, and the relevance and significance of SMEs operating in the wine sector require further and more in-depth studies.In these terms, the wine industry becomes an interesting case for analyzing the process of innovation combined with local and cultural tradition. Accordingly, this work aims to analyze if and to what extent wine SMEs, characterized by a high terroir-orientation, adopt and implementinnovation. The focus is not only on the product and process innovation (technological innovations), but further aspects of business innovation are investigated. These ones concern with marketing and organizational innovations that can be implemented in the wine industry. Moreover, afundamental role is assumed by the investigation on the mechanisms that lead these firms to innovate through externalsystemic sources of knowledge according to the open innovation paradigm.This work contributes to understanding the main domains of innovation, both generally and in a specific sector (i.e., the wine sector). Specifically, the results raise interesting issues regarding the merging of tradition and innovation in wine SMEs. Highly innovative practices should be supported by the long-lasting tradition characterizing wine SMEs operating in the Campania Region, as wine represents a geographic area and its cultural heritage, traditions, and identity for the local community.