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Innovation is all about introducing significant, relevant ideas and practice that are new and are likely to bring positive changes in libraries. Today, libraries face many challenges from rising costs and shrinking budgets to demand for new types of services. If libraries are to meet these challenges and to successfully innovate, they must not only provide adequate value to the user, but must work together with the user for service innovation. Some of the challenges discussed in this paper include; inadequate number of digital librarians, the demand for new types of services, shrinking budgets which may not cater adequately for new equipment and other things associated with innovation. However, innovation studies are quite rare in libraries and it could be said that leadership and management can foster innovation in a library. This study explored innovation in the library profession: issues and challenges. It is recommended that library associations should organize useful training courses, seminars and conferences which could help in preparing well versed librarians in the country for innovation. Stake holders should also give adequate support to librarians by providing fund. Issues related to librarian’s scale promotion and salary must be resolved so that the librarians may get mental satisfaction and work with devotion. This could spur innovation skills in librarians.