This study examines the boundary conditions for the relationship between knowledge search scope and firm innovation performance. We argue that firms are embedded in the external environment, which is pluralistic in nature. The interactions that firms have with other actors in different spaces affect the extent of knowledge spill over, which in turn may affect the relationship between search scope and firm innovation performance. We identify three distinct spaces in which firms operate and interact with other actors - technological space, product market space, and geographic space. We assume a baseline curvilinear relationship between search scope and innovation performance, consistent with extant literature. Further, we propose that knowledge spillover in any of the three spaces will diminish the positive relationship between search scope and firm innovation performance. Our findings, based on a sample of 715 firms during 1980 and 2001 suggest that knowledge spillover in the technology space and product market space has a negative moderating effect on search scope and firm innovation performance relationship; however spillover in the geographic space has no significant effect.