Innovation—introducing new goods, services, or ways of doing business that are valued by consumers—is widely regarded as essential to dynamic and resilient local economies with long-term growth potential. However, innovation in the nonfarm rural economy has received relatively little attention. This report uses the first nationally representative sample of self-reported innovation at the U.S. establishment level to: (1) assess the level of innovation in rural establishments relative to their urban peers; (2) identify rural industries that are the most innovation-intensive; and (3) estimate how innovation at the local level may have affected the rate of recovery after the Great Recession.