The European Union’s strategy to transition to sustainable and renewable energy systems emphasizes the importance of biogas in reducing greenhouse gas emissions. However, Greece remains behind other EU countries in biogas production. This study aims to identify systemic barriers hindering the growth of the Greek Biogas Innovation System (GBIS), focusing on the region of Thessaly. The primary research question targets the identification of these barriers, supplemented by sub-questions addressing the characteristics of GBIS, systemic failures, and community inclusion challenges. The study employs a qualitative case study approach, conducting semi-structured interviews with stakeholders such as biogas producers, biomass suppliers, research organizations, energy communities, funding organizations, natural gas experts, biogas entrepreneurs, and community members. The theoretical foundation is based on the Technological Innovation System (TIS) approach and the System Failure framework, which helps identify broad systemic issues affecting innovation systems. Stakeholder participation and participatory design are integral to the study, ensuring comprehensive consideration of perspectives from all parties involved. Findings characterize GBIS as a diverse network of stakeholders, including biogas companies, biomass suppliers, municipal and governmental bodies, financial and research organizations, and biogas associations, operating at international, national, and regional levels. Relationships among stakeholders vary from positive to negative, weak, competitive, and advocatory. Key functions such as entrepreneurial activities, knowledge development and diffusion, market formation, and resource mobilization are present but not fully optimized. Identified systemic failures include infrastructural failures, such as an outdated electricity grid, and institutional failures, such as complex bureaucratic processes, regulatory gaps, and inefficient waste management regulations. Interaction failures are seen in strong but closed networks that hinder collaboration and information exchange, while capability failures are due to a lack of organizational abilities to overcome obstacles like unstable feedstock supply. Market failures include the volatile price of biomass and the absence of major market players. Additionally, media portrayal, local opposition due to environmental concerns and odor issues, and misinformation about biogas technology create community-related barriers. Climatic risks due to natural disasters, such as recent flooding in Thessaly, further compound these systemic issues. Recommendations to address these barriers include public investments in upgrading the electricity grid and centralizing biomass gathering through third-party collaborations. Strengthening stakeholder cooperation, facilitated by the Hellenic Biogas Association and academia, is crucial for joint R&D projects. Developing educational tools and training programs by universities and biogas companies can build a skilled workforce. Institutional reforms are necessary to streamline bureaucratic processes, close regulatory gaps, and provide incentives for compliance with environmental regulations. Establishing a central organizational body for GBIS can streamline administrative procedures and improve resource management. For community engagement, biogas companies should address local needs before initiating projects to ensure acceptance. Strengthening regional energy communities can empower locals to produce their own energy and educate them on biogas benefits. Promoting public awareness through media and municipalities and involving communities in biogas projects can enhance public perception and acceptance. In conclusion, this study identifies and proposes solutions to systemic barriers in GBIS, aiming to boost biogas production and enhance community involvement and acceptance. The TIS and System Failure approach, combined with stakeholder participation, offers a comprehensive method to analyze and address these barriers across the entire value chain.