Abstract:By systematically elaborating the historic progress of the institutional development evolution, this paper studies the stronger relativity between institution and innovational nation, analyzes the effect of instituition on innovational nation by constructing the models of the effect of institutional innovation on national innovation performance and holds that institutional innovation is the guarantee for the formation of innovational nation. On the basis of learning the development experience of developed countries, ~hina should choose an institutional mode which has low implementing cost in order to create a favorable environment for scientific and technological inventions and technological innovation of the society.