The purpose of this chapter is to analyse and establish the link between territorial development and proximity relations, in order to show how the proximity-based approach could help gain a better understanding of territorial development processes. It is based on the idea that the definition of two main categories of territorial innovations and their inclusion in a new interpretation of Hirschman’s tripod, of exit–voice–loyalty, open the way to new analyses of the combinations of proximities that will help to determine the foundations and the occurrence of territorial development processes. We first provide a precise and well-supported definition of territorial development, before analysing and discussing the two driving forces behind territorial development – relationships of production and modes of governance – while exploring their theoretical legacy in light of the proximity studies. Then we conduct a detailed static analysis of the link between proximity relationships and territorial development processes by widening the notions of innovation and of Hirschman’s tripod to include territorial situations – relating to production or governance. Eventually we provide a dynamic analysis of the paths to territorial development and their links to proximity relations.