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This paper examines shifts in knowledge production at Japanese research universities through a qualitative case study of an interdisciplinary research institute at the heart of a recent national policy initiative. Contemporary science, technology and innovation policies in Japanese higher education are guided by a desire to transition from academic tradition towards interdisciplinary forms of knowledge production and discipline-based academic tradition, balancing growing expectations for universities to tackle societal challenges and their goal to become globally competitive. We examine this transition through a case study analysis of Tohoku University, selected as one of seven ‘Designated National Universities’, and its flagship International Research Institute of Disaster Science. Documentary analysis revealed that, since its selection in the Designated National Universities programme, the institute had placed a renewed emphasis on interdisciplinarity, evident in restructuring towards a ‘blended hybrid’ model designed to reconcile the different institutional logics of diverse research traditions embodied by its staff. Internationalisation and engagement with governmental, industrial, and community partners were further goals implicated in this process. Interviews with key stakeholders uncover the opportunities and barriers to the attainment of these goals. We conclude with implications for knowledge production policies in Japanese higher education, arguing that a shift to ‘blended hybrid’ institutional forms is necessary but insufficient to maintain successful interdisciplinary research institutes. This success is contingent on simultaneous commitment to sustainable international connections and relationships with diverse external stakeholders.