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Teamwork is critical in many industrial sectors. When creating complex software solutions, most companies and public institutions organize work in cross-functional teams and follow the principles of agile development. This approach to knowledge-intensive work seeks to empower team members, ensures that the most competent people make decisions, and manages uncertainty by allowing members to learn and adapt as the work progresses. Advice on teamwork is abundant. For example, the Google re:Work model offers advice to development teams in the form of five key factors for successful teams, including psychological safety, structure and clarity, and teamwork that the team members consider meaningful. There is also general advice from years of studies of teamwork and from empirical studies on agile development teams. However, there has yet to be a model that draws together the knowledge from all of these sources and specifically focuses on the effectiveness of agile teamwork. To fill this gap, we have developed an Agile Teamwork Effectiveness Model (ATEM). Our model is based on a review of empirical studies on agile development teams, general studies of effective teams and teamwork, and practitioner advice. We also incorporated findings from our own two case studies and 22 focus groups. Though primarily intended for collocated agile software development teams, the increasing adoption of agile methods outside IT departments may make the model valuable for other agile workplaces.