Innovation is vital for business sustainability and market competitiveness, with employees playing a crucial role. Current research on employee innovation focuses on individual traits and organizational context, overlooking competition and cooperation. However, these factors influence employee performance. This study reveals through a scenario experiment and a questionnaire that: (1) A balance of competition and cooperation in a team increases exploratory-exploitation learning tension. (2) A combination of high competition and high cooperation positively impacts this tension more than a low competition–cooperation mix. (3) In a contradictory mix, the “high competition-low cooperation” combination has a greater positive impact than the “low competition-high cooperation” one. (4) This tension mediates the relationship between intra-team co-opetition and employee innovation. (5) A paradox mindset enhances the relationship between learning tension and innovation. The study provides insights on improving employee innovation through intra-team co-opetition, exploring mediation mechanisms and boundary conditions.