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Knowledge management in offshore outsourcing projects is a very important topic, but this area of research has got limited academic attention leading to lack of studies exist on the management of both client's and service provider's knowledge for developing embedded software. The main goal of this study is to fill in this gap by analyzing client's generic and specific knowledge as well as the service provider's generic and specific knowledge and how this knowledge could be effectively managed in this endeavor. We conducted an extensive literature review on the major topics related to this field. From the analysis, an integrative model of knowledge management for embedded software development through offshore outsourcing is developed which deals with both parties' generic and specific knowledge. We posit that through the provision of adequate training, where outsourcing client takes the main responsibilities in planning and conducting what kind of distinctive knowledge types should be delivered to service provider and how it should be performed, it is possible to facilitate effective knowledge transfer and management for the development of high quality embedded software through offshore outsourcing.