The software industry is an ideal case of information production with a high importance of knowledge and information management. This paper distinguishes information and knowledge management and points out the dependencies. It analyses the situation, enablers and restrictions to knowledge management in software companies. In two case studies, a number of obstacles to the introduction of knowledge management such as a lack of awareness, a technical oriented professional code, or time and cost pressure in software development projects are identified and measures towards the introduction of an effective knowledge management system are illustrated. The findings from the case studies are summarized in general problems and possible solutions for knowledge management in medium-sized software companies.