In January 2008, the Turkish Governmentrequested the World Bank to jointly undertake an assessmentof its National Innovation System (NIS) in order to helpguide its ongoing efforts to deepen the role of innovationin the Turkish economy. This report identifies the recentprogress and key ongoing challenges facing Turkey's NISand draws on international experience to outline potentialissues for further analysis. The next section provides anoverview of the institutional structure, policy frameworkand main programs of Turkey's NIS and identifies issuesin three main areas that hinder innovation performance: theintellectual property right (IPR) regime, collaborationbetween the research and enterprise sectors, and innovationfinance. The third section uses available information(aggregate and firm-level data and a set of 20 case studies)to provide a review of the innovation and technologyperformance of the enterprise sector in Turkey andpreliminarily address its possible determinants. Areas forfurther potential study and analysis are identified based onthe key findings in each section.