As an emerging external governance force，institutional joint ownership can promote the realization of high-quality development of enterprises. Using the data of Chinese listed companies from 2010 to 2020, this paper finds that institutional joint ownership plays a significant role in promoting enterprise innovation. Financial constraints play an intermediary role in the impact of institutional joint ownership on enterprise innovation. Product market competition and executive equity incentive play a positive regulatory role in the impact of institutional joint ownership on enterprise innovation. Further heterogeneity analysis shows that the promotion effect of institutional co ownership on enterprise innovation output is more obvious in private enterprises and high-tech enterprises. The promotion effect of institutional joint ownership on enterprise innovation investment is significant in private enterprises and high-tech enterprises. This paper explores the realisation mechanism and micro basis of institutional joint ownership affecting enterprise innovation, and the research conclusions provide reference guidance and suggestions for promoting enterprise innovation.