This paper studies the design of co-located spaces and how organizational actors experience such spaces. The literature on co-location is ambiguous about how reduced physical distance increases collaboration. To address this problem, we draw on an ethnographic study of a co-located railway control center, housing the largest Dutch railway organizations under one roof. Although the intention of the co-location was to improve collaboration by bringing different organizations into closer proximity, our findings tell a different story. Railway employees developed several territorial practices (preserving existing boundaries, creating new boundaries, and the situational use of boundaries) through which they resisted the design of the control center, thereby changing the control center from co-located to “dis-located.” We argue that understanding the relationship between co-location and collaboration should not only focus on how such spaces are designed but, rather, account for how spaces where collaboration is demanded are experienced and used by employees.