The public sector is seen to play an important role as a facilitator of innovativeness and competitiveness in the private sector. Besides this important role the innovativeness in the public sector must also be promoted in new ways because of the new challenges facing public sector service production. This paper introduces the ideas of the emerging open innovation paradigm in the public sector context presenting a case for user involvement in the public sector service development context in the Lahti region in Finland. This paper also discusses in more wider terms the emerging role of the public sector as not only a facilitator of innovativeness in the private sector organisations, but also as a target of innovation policies and especially highlights new ways to involve the end-users of public sector services in producing innovations. The implications for the regional innovation system (RIS) are also discussed.