The paper examines a multi-level and multi-sectoral territorial policy for neighbourhood regeneration: the Urban Italia programme in Cinisello Balsamo, Italy. Within the debate on the contemporary shift from well structured government dynamics towards more indefinite and participatory governance practices, the article contributes with observations taken at the level of the local administration, questioning the adoption of European policy models and advocating it as institutional learning. Analysing the social structure – human agency dynamics within a project aimed at creating new public spaces through a participatory programme, the paper sheds light on a number of structural and conjunctural elements intertwined with human habitus explaining innovation and continuities in urban governance.