Industrial Design education in Australia tends to promote a comprehensive view of the role of designers; commercially aware form-givers who can deal with the technical, material and production issues related to the implementation of their designs. The Design Studio experience is generally regarded as the central educational device which is used to expose students to the principles, practices and possibilities of designing. It is also seen as a venue for acquiring understandings of various concepts and disciplines related to the field, and learning to integrate these within designs. Collaborative and multidisciplinary activities are often used within the design studio to connect students with these contributing disciplines. While much has been written on the nature of the studio as an educational setting, this paper identifies some of the challenges in contemporary design studio teaching using examples from an Australian university context. One central aspect of these challenges is the manifold nature of learning outcomes intended to be gained through the studio experience. Each student is expected to develop a capacity to define and resolve design problems; to understand and internalise the discipline’s ways of operating and to appreciate and identify with (industrial) design as a discipline in its own right. In addition, each student has to develop some understanding of particular knowledge areas related to the design of products and systems; the social, cultural, technological, commercial and environmental where-with-all that is required in designing. Further, the studio typically seeks to foster the students’ ability to collaborate with other designers and other specialist disciplines in the corporate activity of designing, developing and distributing new products. The management of these different types of learning outcome is being affected by issues such as the changing technology used in design work, the bourgeoning complexity of products and systems (and services) being designed and the increasing sophistication of all the disciplines involved in product development and their own methods of inquiry and knowledge-building. This paper presents the view that contemporary industrial design is now a field of such breadth and complexity that the traditional undergraduate studio teaching model is unable to provide a comprehensive educational response.