This paper explores the extent to which core elements of partner organizations’ micro-contexts shape the development of strategic alliances. It extends prior research, which has largely been concerned with alliance-specific variables such as their initial structure and ‘best practices’. Extant research has typically underplayed broader micro-level elements, particularly those of a psycho-sociological nature. Leveraging a longitudinal case study of a major alliance in the high-tech industry we develop an alternative perspective to mainstream alliance research. We suggest that in order to evolve alliance theory must encompass elements broader than those specifically related to alliances themselves since alliances do not evolve in isolation from organizations’ idiosyncratic micro-contexts and managers’ behavior, but are rather significantly shaped by them. Implications for research and practice are discussed.