The emerging work on Open Source Software (OSS) field focuses on the various factors that lead to effectiveness in OSS development teams. This paper utilizes the theory on knowledge integration to show how the capability of OSS projects in integrating knowledge influences their effectiveness. The research model is based on the idea that competency of OSS projects along three characteristics of knowledge integration (1) Efficiency of Integration (2) Flexibility of Integration (2) Scope of Integration, enhances the effectiveness of the project. The effectiveness of the project is measured based on the output that the project generates during software development. The impact of the three knowledge integration capabilities on effectiveness of OSS projects are tested using objective data on 152 open source software development projects. Results indicate that efficiency and flexibility of knowledge integration of OSS projects, positively influences the effectiveness of these projects. Theoretical and practical implications are discussed.