The standard model of diffusion is based on communication among actors. But members of an organization also share common goals and identify with the collective of the organization. Thus they are more likely to support one another and more likely to exert social pressure on one another to adopt an innovation. While these processes have been noted, they have not been characterized under a general theoretical framework. Here we describe informal support and social pressure as manifestations of social capital, and the diffusion of an innovation within an organization as a function of the distribution of social capital in the organization. Consideration of social capital links the diffusion process to aspects of organizational culture such as sense of community. The theoretical image is of a spiraling process of social capital. Through a study of ten elementary schools we find evidence consistent with our theoretical links between diffusion of innovation and social capital.