Small business significantly affects the transformation of the structure of the economy, becoming a special sector for the formation of new markets. According to available estimates, small firms will need much less time than large companies to research the bulk of economic innovations and bring them to the form of an industrial design. A prerequisite for the development of innovative small business is a developed support infrastructure, the existence of an effective system of intellectual property protection, the formation of flexible market mechanisms to increase the business activity of entrepreneurs, primarily due to the continuous process of improving their skills and constant self-education. Only entrepreneurship based on a "knowledge economy", i.e. entrepreneurship, applying and using new knowledge in its activities and constantly increasing and replenishing them, can be called innovative and can help create the prerequisites for the formation of the National Innovation System. To develop and introduce product and process innovations that determine the innovativeness of entrepreneurial activity, a process of self-education and the exchange of knowledge and experience are required. The following factors can be identified as factors determining the important role of small businesses in the field of innovation.