Despite possessing significant social capacities, rich indigenous knowledge, and the active participation of local actors, Iran’s grassroots innovation ecosystem faces a structural challenge termed the “Sustainability Trap.” In this state, many grassroots innovations, notwithstanding their initial successes, fail to achieve continuity and institutionalization due to policy instability, weak institutional coordination, disruptions in collective learning, and the absence of foresight mechanisms. Existing studies have primarily focused on the roles of actors and supportive mechanisms, leaving a gap in understanding the institutional capacities required to navigate uncertainty and provide long-term guidance for innovation ecosystems. This study aims to design a framework for institutionalizing foresight to enhance the sustainability of grassroots innovation ecosystems and overcome the sustainability trap. Adopting a design-oriented approach, the research first reviewed policy documents and international experiences, followed by semi-structured interviews with ten experts in the fields of innovation, foresight, and policymaking.