Knowledge management is considered to be the most critical step for developing innovation processes and reaching sustainable competitive advantage in the marketplace. However, the systematic handling of knowledge in many organisations is far from being complete. In particular, for large organisations the competitive capability becomes more dependent on the efficient intra-organisational sharing of resources--especially knowledge. The aim of the article is to study knowledge sharing in large organisations as linked with the transaction cost theory. Therefore, we start with defining the term "knowledge" and classifying the process of "knowledge sharing". Having transferred the transaction cost theory into intra-organisational knowledge sharing, we will build up a comprehensive theoretical construct of knowledge sharing in large organisations from the transaction cost theory perspective.