To date, European Union (EU) policy has been in favour of balanced regional growth. Since the 1980s, EU has adopted a policy which aims to strengthen the science and technology bases of the member states, necessary to increase their competitiveness. This EU research, technology and development (RTD) policy also has to contribute to other Community policies such as economic cohesion. Competitiveness and cohesion are two basic elements which are necessary for a balanced economic growth. Despite these objectives, many economic and technological differences still exist between European regions. To show these differences, we present in this paper a new typology of regions which are categorised on the basis of their current state of economic and technological development, their short-term evolution in technological development and their short-term economic growth. Further, we analyse whether these different types of regions tend to converge or diverge, both economically and technologically. Because technological development is the foremost factor used to explain economic growth we further analyse the role of EU RTD policy to diffuse technology from the economically more advanced to the less advanced regions. To explore this question, we use a unique set of regional participation and collaboration data in the EU Framework Programs. Regional participation data is used to measure the direct impact of EU RTD policy on technology development, while the collaboration data is analysed by means of social network techniques as an indicator of technology diffusion. It is shown that the current RTD policy enforces the technological strength of the best performing regions, but plays a clear role in technology diffusion towards a limited group of catching up regions. (C) 2001 Elsevier Science B.V. All rights reserved.