The paper discusses dimension and measure system of industry innovation of China based on review of innovation capacity theory. Through data character analysis of dimensions, dimension structure evaluation and comprehensive evaluation of innovation for manufacturing industry in China, we find out that i) innovation capacity of manufacturing industry is weak; ii) contribution of transformation of innovation to output is low; iii)innovation capacity varies among enterprises and iv) the R&D and cooperation between industry and academia makes little contribution to innovation capacity cultivation in foreign-owned enterprises.