This article aims to shed light on the recent sustainabletransformation dynamics of the Norwegian aquacultureindustry. Drawing on perspectives from the socio-technicaltransition studies this article investigates how this processhas been shaped by a specific policy instrument known asdevelopment licenses (DL) launched in 2015. The articlecaptures the DL as a transformative innovation policyinstrument and shows how this has played a key role insteering the directionality of the technological innovationsin the sector to instigate the sustainable transformationprocess of the industry. The article reveals that the DL hasprompted the emergence of new challenged-oriented inno-vation systems through reorientation and reconfigurationprocesses. These processes specifically involved both themobilization of actor-networks in the industry, including afunctional reorientation by the key regulatory organ—theDirectorate of Fisheries—and harnessing locally availablepre-existing knowledge and skills—particularly in the Petro-maritime industry. The licensing scheme means that theindustry is currently in the process of transition to becom-ing a sector based on multiple aquaculture productiontechnologies. However, we suggest that addressing the long-term sustainable transformation imperatives of thesector will largely depend upon the ability to identify andsupport further development of promising niche aquacul-ture technologies.