The nature and the extent of technological change are analysed from a comparative Spanish and European view, establishing the interrelationships between its components and its final effects. The relationship between technological change and the industrial organisation is studied from the permeability of the factory system to small and medium size firms. This fact made possible the development of a flexible industrial structure which was shaped in the making of a capable woollen textile district in die Vallès, and finally strengthened the competitive advantages of those firms in relation to the pioneer big firms. Last, induced changes on the labour force structure are considered.