The economic development of a country is determined by various key roles played by Small and Medium Enterprises (SMEs). They contribute approximately 40 percent of the Gross Domestic Product (GDP) and create 80 percent of jobs. However, SMEs have been facing performance challenges which threaten their sustainability based on entrepreneurial abilities. Therefore, it is in the interest of the Kenyan government, organizational philosophers, managers and equally entrepreneurs who have long shown more interest in innovation in SMEs, predominantly due to the vital role innovation plays in safeguarding sustained competitive gain. In consequence of the increase in competition levels, it is therefore necessary to identify appropriate innovation strategies that would make their product and services competitive in the market in which they operate in. Thus, this study’s objective was to define and determine the effect of marketing innovation strategy and entrepreneurial performance of SMEs in Nakuru East Town Sub-County, Kenya. This study’s specific objective was the effect of Marketing Innovation Strategy on entrepreneurial performance of selected SMEs in Nakuru East Town Sub-County, Kenya. It is in this context that Nakuru East Town Sub-County was targeted because of the high rate of SMEs decline in the area and the variability in the entrepreneurial nature of 1,259 SMEs that have single business permits operating in the area including: wholesalers and retailers, fishmongers, salons and barbershops, cybercafés, hotels and cafes, construction, and hardware stores. The study engaged a descriptive and explanatory research design that targeted 126 respondents who are 10 percent of the selected registered 1,259 SMEs in Nakuru East Town Sub-County. A questionnaire which had open and close ended questions was adopted in this study. The questionnaire was administered using drop-and-pick later methods for some, and for others the researcher herself used an interview schedule. The respondents of the study were the owner or the in-charge/manager of the SME. The questionnaire was piloted to determine validity and to establish whether the questions will measure the expected theorized variables. According to the findings, all of the items' Cronbach's Alpha values were greater than 0.7. this indicated that that the questionnaires used to collect the data were reliable. The data collected was quantitative and was analyzed using descriptive and inferential statistics. According to the findings, there is a strong positive and significant relationship between marketing innovation strategy and entrepreneurial performance of SMEs in Nakuru East Town Sub-County. Based on these conclusions, the study suggests and recommends that SMEs business owners should consider improving product design, introduce new distribution channels, find new markets for their products and change their advertising methods. These will lead to growth in the market share, customer satisfaction, profitability and efficiency.