Smart cities leverage technologies, in particular digital, to generate a vast amount of real-time data to inform policy- and decision-making for an efficient and effective public service delivery. Their success largely depends on the availability and effective use of data. However, the amount of data generated is growing more rapidly than governments’ capacity to store and process them, and the growing number of stakeholders involved in data production, analysis and storage pushes cities data management capacity to the limit. Despite the wide range of local and national initiatives to enhance smart city data governance, urban data is still a challenge for national and city governments due to: insufficient financial resources; lack of business models for financing and refinancing of data collection; limited access to skilled experts; the lack of full compliance with the national legislation on data sharing and protection; and data and security risks. Facing these challenges is essential to managing and sharing data sensibly if cities are to boost citizens’ well-being and promote sustainable environments.