The seismic response of existing un-reinforced masonry (URM) buildings is strongly dependent on the characteristics of wooden floors and, in particular, on their in-plane stiffness and on the quality of connection between the floors and the URM elements. It is generally well-recognized that an adequate in-plane-stiffness and proper connections can significantly improve the three-dimensional response of these buildings, obtaining a better distribution and transfer of forces to the lateral load resisting walls. However, the extensive damage observed during past earthquakes on URM buildings of different types have highlighted serious shortcomings in typical retrofit interventions adopted in the past and based on stiffening the diaphragm. Recent numerical investigations have also confirmed that increasing the stiffness of the diaphragm is not necessarily going to lead to an improved response, but could actually result to detrimental effects. The evaluation of the in-plane stiffness of timber floors in their as-built and retrofitted configuration is still an open question and a delicate issue, with design guidelines and previous research results providing incomplete and sometimes controversial suggestions to practicing engineers involved in the assessment and/or retrofit of these type of structures. In this contribution, the role of the in-plane stiffness of timber floors in the seismic response of URM buildings is critically discussed, based on the relatively limited available experimental and numerical evidences. A framework for a performance-based assessment and retrofit strategy of URM buildings, capable of accounting for the effects of a flexible diaphragm on the response prior to and after the retrofit intervention, is then proposed. By controlling the in-plane stiffness of the diaphragm, adopting a specific strengthening (or weakening) intervention, the displacements, accelerations and internal force demands can be maintained within targeted levels. This will protect undesired local mechanisms and aim for a more appropriate hierarchy of strength within the whole system.