The identification of effective elements of innovation among organizations capture the attention of many scholars whereas organizational climate, organizational culture and knowledge management are the most important elements which can affect innovation. This study comes up with identifying the effect of organizational climate on innovation in Bank Mellat. The statistical population of this study was the staff of Bank Mellat in the City of Tehran that almost added up to 4964 in the year 1390(2010-2011). The samples of this study were based on Cochran’s formula (with an error of %5) with the usage of SRS (Stratified Random Sampling) table of 357 persons. The questionnaire was the tool of gathering information in this study as prepared by researchers from the combination of two standards about innovation and organizational climate. Also the Likert Scale was used to measure the variables. The organizational climate was evaluated with the focus on the seven factors of: “organizational structure, team-working, rewarding, risk-taking, relations, organizational commitment and organizational conflict” which derived from Arabaci’s Model. The results show direct and positive relationship between organizational climate and innovation. At last from the 7 factors of organizational climate, only 4 variables of relations, team-working, risk-taking and organizational commitment were proved to have impact on organizational clomate and innovation.