Compared to knowledge generation between producers and suppliers/buyers, horizontal learning is based on non-traded relations, organized through different mechanisms. This chapter explains how knowledge sharing among competitors can be a rational choice for firms in specific settings. To demystify horizontal learning, four processes of knowledge exchange among competing agents and organizations are discussed, namely socially embedded learning, labor mobility, interaction and monitoring, and collective invention. It is suggested that horizontal learning can be a common practice within many knowledge communities, especially in the early stages of innovation processes when dominant designs and technologies are unclear.