Innovation is necessary in enhancing economic status of Canadian mid-sized cities in the growing knowledge-driven economy. There has been rising recognition that has led to many mid-size cities take control of their economic prosperity after the new millennium, as they try to define themselves in the face of knowledge-based economy. In Canada, several mid-sized cities show that new methods to economic development offers important illustration of how culture and creativity can help in promoting new economic trajectories in a knowledge-based economy and attract a stable workforce, and ensure that they have continued growth and economic stability. The creative city agenda and recent attempts to include culture into a planning process are means to improve new economy based on different class of workers. However, there are different opinions as to whether these tools are the right ones for mid-sized cities. Consequently, adopting a creative city agenda is the best way to integrate culture into planning processes and ensure prosperity of medium-sized cities in Canada. Large cities in a knowledge-based economy pose serious challenges to medium-sized cities in Canada. Several medium-sized cities in Canada have old industrial stations, or lack knowledge base and opportunities for them to compete with large cities. These cities face a difficult task of redefining themselves and their local economies due to lack of resources and knowledge-based concerns that new economies require. Therefore, incorporating the local culture into planning a medium-sized city development may offer solutions to creative city development agenda. For instance, the medium-sized city of Waterloo has found success by redefining its institutional and cultural resources and creative agenda into factors of economic prosperity (Bramwell and David 1187). How do we integrate culture in mid-size cities in driving a new economy? Canada’s medium-sized cities in remote locations from the large cities have limited prospects of benefiting from opportunities of large cities. These mid-sized cities suffer from loss of talent to other cities, as well as the issue of attracting and retaining knowledge-based workers (Polese and Shearmur 3). Consequently, medium-sized cities find it necessary to pursue local creativity, and at the same time, incorporate local culture into economic policy for sustained growth. Therefore, there is a need for both national and local government to work together in redefining new economic policies for Canadian medium-sized cities. Medium-sized cities need to adopt modern planning for economic growth in order to stay relevant in a knowledge-driven economy. This can only happen when there is a strong relationship among the local authorities, private and public investors, and local culture that result into sustained economic development. Sustainable economic growth must rely on successful plans with the stakeholders using the local capital and culture to do so. Therefore, medium-sized cities must develop innovation strategies at the local level to incorporate their cultures into economic development to reduce the gap that exists due to lack of workers in a knowledge-based economy. However, this relies on innovation and inte