This paper stresses that innovation in Hungary leaves something to be desired, and a perpetual lack of innovation also applies to the agro-food sector which, of course, consequently weakens the nation’s general competitiveness. The 2007-2013 period and the subsequent resources provided by the EU present new challenges. It is not overstating the case to say that if Hungary is not able to capitalize on this period, then it will face competitive disadvantages capable of placing Hungarian agriculture in a critical situation. To avoid this, the conditions for innovation and innovation performance must be improved. The system of innovation in the Hungarian agro-food sector does not lend itself to the application of the model constructed on R+D. Therefore, it appears practical to follow the adaptive innovation model, which would be particularly useful for SMEs.