This study examines the innovation practices of specialized and sophisticated “little giant” firms in the era of big science, investigating how disciplinary diversity in scientific collaboration influences breakthrough technological innovation through the lens of knowledge recombination theory. Analyzing unbalanced panel data from 2,464 “little giant” firms in China's new materials sector from 2000 to 2018, we uncover significant findings regarding the mechanisms and boundary conditions of interdisciplinary scientific collaboration. Our empirical results demonstrate that disciplinary diversity in scientific collaboration positively affects breakthrough technological innovation in these specialized SMEs. This relationship is partially mediated by knowledge complementarity, suggesting that the integration of diverse yet complementary knowledge domains facilitate the recombination of existing ideas into novel technological solutions. The study further reveals two critical boundary conditions that shape this relationship. First, we find that intellectual property protection strength negatively moderates the relationship between disciplinary diversity and knowledge complementarity. Stronger IP protection appears to create barriers to effective knowledge sharing across disciplines, potentially limiting the synergistic benefits of interdisciplinary collaboration. Second, technological turbulence emerges as a positive moderator between knowledge complementarity and breakthrough innovation, indicating that rapidly changing technological environments enhance the value of integrating diverse knowledge streams. These findings contribute to multiple theoretical domains. The study advances knowledge recombination theory by elucidating how interdisciplinary scientific collaborations operate differently in specialized SMEs compared to larger firms or research institutions. We provide empirical evidence for the micro-level mechanisms through which diverse collaborations translate into innovation outcomes, particularly highlighting the pivotal yet partial mediating role of knowledge complementarity. Furthermore, our identification of IP protection and technological turbulence as opposing moderators offers new insights into the contextual factors that enable or constrain the innovation benefits of interdisciplinary collaboration. Methodologically, the research employs rigorous econometric techniques to analyze longitudinal data while controlling firm-level characteristics and environmental factors. We utilize multiple indicators of breakthrough innovation, including patent originality and technological impact measures, to ensure comprehensive assessment of innovation outcomes. The practical implications are significant for both policy and management. Policymakers should consider developing balanced IP frameworks that protect innovation incentives while facilitating cross-disciplinary knowledge flows. Targeted initiatives like interdisciplinary research platforms and public-private partnerships could enhance collaborative innovation for specialized SMEs. For “little giant” firms’ managers, the findings underscore the importance of strategically cultivating scientific partnerships across complementary disciplines while remaining responsive to technological changes that may amplify the value of knowledge integration. This study opens several promising research directions. Future work could explore optimal levels of disciplinary diversity, potential sector-specific variations beyond materials science, and the organizational processes that facilitate effective knowledge recombination in specialized SMEs. By integrating theoretical insights with empirical evidence from China's innovative firms, this research provides a nuanced understanding of how interdisciplinary scientific collaboration drives breakthrough innovation in the big science era. The findings highlight the complex interplay between knowledge diversity, institutional environments, and technological contexts in shaping innovative outcomes. They contribute to ongoing discussions about fostering innovation in specialized SMEs through scientific collaboration while accounting for the practical constraints imposed by IP regimes and technological dynamics. This research ultimately enhances our understanding of how “little giant” firms can leverage interdisciplinary scientific partnerships to achieve technological breakthroughs.