Morelos, home to 1.9 million inhabitants, is located south of Mexico City. Its proximity to the metropolitan area of Valle de Mexico has favoured the development of the manufacturing sector as well as tourism and related services. Specialisation in manufacturing has doubled since 2003, and the share of gross value added (GVA) reached 23.4% in 2013, representing a resource for the economy, with the right framework conditions. In terms of employment, the economy is very diversified, with the manufacturing, agricultural, service, and public sectors each contributing to more than 10% of employment in Morelos. The state also contains several prominent research institutes that have contributed to more patents per capita than the Mexican average. Finally, natural and cultural amenities, as well as favourable climate conditions are potential drivers for tourism. An integrated policy approach is necessary to exploit the potential synergies amongst these diverse economic activities.