Economic theories recognize the leading role of innovations in the process of economic growth. Undoubtedly investing in innovation is a challenge for all enterprises operating in the modern highly competitive environment. The role and position of small and medium enterprises is unique and extremely important in this matter. The main objective of this study is to examine the conditions of undertaking innovative activities by SME sector in Greece and the identification of the critical success factors of SMEs in the field of innovation. The analysis used the results of the survey and statistical materials of SME from a sample of 410 respondents. The paper is organized as follows: in the next section we briefly present the importance of SMEs for sustained economic development and the actual development of SMEs growth in Greece. This is followed by the presentation of research methodology and the data sources used in the analysis. The results are presented and discussed in section four. We conclude with study limitations and further opportunities for research.