This study assesses the effect of innovation and proactiveness on the performance of SMEs in Adamawa State. The study used a survey research design in data collection. The primary source of data was collected from the selected sample of 259 entrepreneurs in Adamawa State. The study adopted the Smart PLS Technique in data analysis and hypothesis testing. The result of the study shows that innovation has significantly influence SMEs’ performance. In addition to pro-activeness indicate significant positive relationship on the performance of SMEs in Adamawa State. It was recommended that SMEs should be encouraged to achieve set targets by being more innovative as part of steps for improving their growth and performance in Adamawa state. Also, SMEs should be alert and responsive to the environment and strive to be proactive to overcome the challenges and exploit the opportunities in the environment that are associated with entrepreneurship so that they can gain a competitive advantage over competitors.