| Summary: | In the knowledge economy, innovation is the most important source of change. Continuous innovation in contemporary dynamic conditions is of great importance because it provides sustainable competitiveness in the domestic and global levels. Serbia is facing major challenges when it comes to innovation. The development of the Serbian economy is not entirely driven by innovations because the business environment is not sufficiently adapted to the development of the innovation system. Also, the scientific community is an invaluable national resource that is underutilized. There are no adequate allocations for science, which is the basis for the creation of new knowledge relevant to the emergence of innovation. In addition to these there are many other factors that hinder the development of innovative Serbia. The goal of this paper is to point out what the situation is in terms of innovation Serbia in 2016, which factors limit the innovative ability of our country and what are the measures to be taken to facilitate the development of the system innovation Serbia.
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