Abstract: Based on the provincial panel data during 1999-2007, the impact of industrial agglomeration on regional innovation in China is explored. The results indicated that under the condition that scientific and technical personnel and funds as well as institutional innovation are under the control, the industrial agglomeration affects positively on the regional innovation, but at a bit lower degree as compared with the effect derived from the each control element mentioned above. Industry-specific analysis reveals that both high-tech industrial agglomeration and traditional industrial agglomeration promote regional innovation, and this fact can serve as a theoretical support for nurturing characteristic industrial clusters combined with comparative advantages for certain regions. However, majority resource-dependent industrial agglomerations have the negative influence on the regional innovation because of the crowding-out effect caused by the excessive dependence on the resources of human capital and technological innovation input.