Whilst a party system reflects both competitive and co-operative interactions, academic research has largely focused on the competitive interactions of parties. This is particularly the case in British politics, where party interaction remains broadly understood in the context of adversarial competition between a centre-left party and a centre-right party. Where co-operation is discussed, it is mostly limited to discussion of coalition and how this threatens the narrative of competition. To address this, this paper proposes a framework of party co-operation. First, it outlines the arenas where co-operation might take place: co-operation in government, co-operation in parliament, and co-operation in the electorate. Second, it incorporates incentives and obstacles to co-operation based on electoral, ideological, organisation, and elite-level concerns. The paper operationalises the framework by examining the contemporary case of the British Labour Party and British Liberal Democrats, who have a lengthy and complicated history of competition and co-operation. The paper highlights the differing incentives and obstacles to co-operation between political parties, and invites future applications of it in other contexts.