Studies based on the relationship between the evolution of family firms and their innovative performance have been rare in family-business research. This chapter reviews the characteristics of family firms and their relation to innovation strategies in emerging markets, with the case of Turkish family firms, and provides an explorative analysis of the relationship between the factors affecting the development of family business and their innovative strategies in Turkey. The most prevalent characteristics of Turkish family firms that affect their innovation decisions are the collectivist family culture, pragmatic growth decisions, and paternalistic control tendencies. The differences based on these characteristics should affect their approach to innovation differently. Founders follow an exploitative innovation strategy. Later generations coming after the founder generation generally focus on more exploratory strategies to meet market demands. By the third generation, as the firm has institutionalized, they try to balance the two forms of innovation by using their resources and exploring environmental opportunities in the form of ambidexterity.