Abstract: Universities are the main contributors to knowledge innovation. Each university has its own characteristics of innovation activity. To improve the innovation ability of Chinese universities, it is necessary to have a better understanding of the present situation so that more effective policies can be made. With the application of factor analysis, the article chose 601 Chinese universities as the object of study to evaluate the innovation ability of Chinese universities. These universities are divided into 4 categories, including Entrepreneurial Ⅰ, Entrepreneurial Ⅱ, research, and teaching with research. And their innovation abilities are also divided into four different levels. These results indicate there are significantly unbalanced development among Chinese universities. Some universities exhibit strong ability of innovation, but most universities still need further improvement.