Recent studies suggest a potential relationship between dynamic capability and innovation performance in achieving a successful business. The contribution of dynamic capabilities to innovation performance remains unclear and at the center of the debate. Based on a systematic literature review, the purpose of this research is to explore how dynamic capability and innovation performance should be assessed in the future. The most promising approach seems to be indirect, as it appears that dynamic capabilities primarily cause change and intermediate outcomes, though far from being the most hypothesized relationship. However, the definition and effects of dynamic capabilities and the role of environmental dynamism are still under discussion. This study is motivated by concerns regarding the nature of dynamic capability while focusing on the connection between dynamic capability and innovation performance; effort should be made toward exploring the relationship as a whole with the organization’s innovative performance, towards a greater knowledge on the role of various dynamic capability components and work environment as significant factors in encouraging innovation performance. The research provides convincing support for the importance of dynamic capability over time, thereby enhancing innovation performance.