Abstract: Chain-style industrial cluster has characteristics of cluster and supply chain, so technology innovation activities of enterprises happen inside and outside the supply chain. From the perspective of technological innovation, the process of cluster's innovation activity was divided into the R&D stage and the output stage, and the coefficients of technology spillover, R&D funds, and technological innovation success probability were put in the game model. Then, dynamic game method was applied to analyze the enterprise's technological innovation inside and outside the supply chain for deducing the enterprises' profit equilibrium function. Finally, the following conclusions:(1)In the supply chain, when whatever upstream and downstream enterprises innovate or not innovate, both of them will share the profits.(2)Due to the presence of technology overflow phenomenon in the supply chain, when some enterprises innovate, they and their upstream and downstream enterprises will increase profits.(3)In the supply chain, the profits of upstream and downstream enterprises who had innovated cooperatively are more than the ones who were out of innovation or innovation independently.(4)With the core enterprises of the supply chain competing more, the degree of technology spillover will be smaller, the market share of enterprises who had not innovated will decline, and the profit of them will reduce.

Key words: chain-style industrial cluster, technology innovation, game