This paper discusses the co-creation process that led to Dresden city’s smart city strategy, channelling the contributions from various stakeholder groups – politics, administration, science, civil society, and industries – into one vision for integrated and sustainable digitalisation-based urban development. This co-creative strategy process aims to overcome technology-centred smart city approaches that often fall short of generating public value, and therefore lack of public support. As part of the federal funding priority “Model Projects Smart Cities”, Dresden’s municipal administration and members of the Technical University Dresden started a 1-year strategy creation phase in 2021. The resulting smart city strategy forms the basis for a subsequent 4-year implementation phase during which specific measures and projects work towards an overall smart city vision. To this end, the strategy phase had to result in a comprehensive innovation agenda for transforming Dresden towards a smart and sustainable city (i.e., Dresden’s smart city strategy). Moreover, Dresden´s application for the federal smart city programme centres on providing digital solutions to neighbourhoods to invigorate the urban society and locally create new qualities for living and working. Pursuing this goal requires a comprehensive strategy based on local stakeholders’ needs and resources. In the project’s first step – the strategy phase – we devised a novel co-creative process that integrated approaches from innovation and creativity management (“Double diamond”), participation and co-creation research (“Quadruple helix”), as well as IT and software development (“Agility”) into one methodology. This new approach effectively guided the strategy-making process from a comprehensive status quo analysis through creative “visioneering” towards an outline of strategic fields of action and specific measures. By combining these approaches, we ensured a dynamic, iterative process that a) effectively involves all relevant stakeholder groups, b) resulted in innovative concepts and implementation measures, and c) created a robust onward momentum leading to a feasible and context-sensitive urban development strategy in a short time.