With more than half the world’s population residing in cities, responsibility for solving societal challenges – ranging from climate change to terrorism and the future of work – is increasingly falling to officials at the local level. However, deteriorating fiscal conditions, coupled with a long-term decline in public trust in government, has diminished local leaders’ ability to meet citizens’ increasingly complex demands. With cities as laboratories testing bold approaches to complex public policy challenges, leaders are in urgent need of new tools and methods that allow them to tap into their most important, yet often underused asset: people. “People-Led Innovation: Toward a Methodology for Solving Urban Problems in the 21st Century,” has been developed by The Bertelsmann Foundation and The GovLab to empower public entrepreneurs, particularly city-level government officials, to engage the capacity and expertise of people in solving major public challenges. Co-authored by Andrew Young, Jeffrey Brown, Hannah Pierce, and Stefaan G. Verhulst, the guide focuses on unlocking an undervalued asset for innovation and the co-creation of solutions: people and their expertise. The methodology incorporates lessons learned from multiple experiments and practices - including those by The GovLab such as Civic Challenges and Smarter Crowdsourcing – while drawing heavily on the Bertelsmann Foundation’s Transatlantic Policy Lab project, which used week-long living labs in Boston and Athens to source innovative and neighborhood-specific recommendations. Designed for city officials, and others seeking ways to improve people’s lives, the methodology provides: A phased approach to helping leaders develop approaches in an iterative manner that is more effective and legitimate by placing people, and groups of people, at the center of all stages of problem-solving process, including: problem definition, ideation, experimentation, and iteration. A flexible framework that instead of rigid prescriptions, provides suggested checklists to probe a more people-led approach when developing innovative solutions to urban challenges. A matrix to determine what kind of engagement (e.g., commenting, co-creating, reviewing, and/or reporting), and by whom (e.g., community-based organizations, residents, foundation partners, among others) is most appropriate at what stage of the innovation lifecycle. A curation of inspirational examples, set at each phase of the methodology, where public entrepreneurs and others have sought to create positive impacts by engaging people in practice.