Based on the effect of downstream manufacturer on upstream innovation,we construct three supply chain collaboration innovation modes and explore the innovation game process consisting of one supplier,one manufacturer and one third-party research firm among which the supplier acts as a core firm when demand is sensitive to price.The research illustrates that when the supplier innovation partner 's ability is similar,from judging from innovation inputs,expect profits or demand quantities,the mode of supplier collaborating with his close downstream is superior to that of collaborating with third-party and non-collaborative innovation.This mode decreases the input of supplier and its risk of innovation,enhances the innovation inputs of the supply chain and reaches win-win for its supply chain partner.At last a method of coordinating supply chain innovation is proposed.