Abstract: The implementation of the “double innovation” strategy has promoted the vigorous development of the incubation industry. It also brings the increase number of incubation carriers and incubated enterprises. And the incubating enterprises have gradually become the main force to promote regional technological progress, economic development and overall strength enhancement. However, in practice, the problems of low performance and insufficient growth of incubating enterprises have not been solved. The survival and sustainable development of incubated enterprises in China are facing severe challenges. Therefore, it is urgent to explore the underlying incentives and the path for transformation and upgrading. Existing studies have mostly focused on the impact of external macro-factors, such as policy environment and market economy on the innovation activities and performance of incubating enterprises. Researches on incubating enterprises’ internal driving factors are also limited in a single-element level, which lack a comprehensive study of the characteristics of the organizational elements of incubating enterprises from a micro perspective. Based on the organizational element theory, this paper empirically explores the influence of characteristics of incubating enterprises on innovative behavior selection and entrepreneurial performance. The relevant research data has been collected from Changchun, Shenyang, Beijing, Qingdao, Hangzhou and other places across China by research questionnaires. Finally, on the basis of data from 467 valid questionnaires, the empirical analysis has been conducted. The research results show that: the characteristics of organizational elements such as innovative organizational culture, entrepreneurial strategic orientation and flexible organizational structure of incubating enterprises can significantly promote the development of their innovative behaviors and entrepreneurial performance. And the promotion effect of the innovative organizational culture is the most obvious.; Both exploratory and exploitative innovation behaviors have significant positive impacts on the entrepreneurial performance of incubating enterprises, and the promotion effect of the exploratory innovation is more obvious; Both innovation behaviors also play partial intermediary role in the influence of the characteristics of the incubating enterprise’s elements on entrepreneurial performance, and exploratory innovation has a stronger effect on the improvement of entrepreneurial performance than exploitative innovation. Based on the research conclusions, we put forward three enlightening countermeasures that include: firstly, it is important to strengthen the cultivation of the innovative elements of incubating enterprises, and should pay attention to the collaborative integration of innovative organizational culture, entrepreneurial strategic orientation and flexible organizational structure to maximize the entrepreneurial performance of incubated enterprises. Secondly, incubated enterprises should focus on the resource investment of exploratory innovation activities, and seek innovative business operation mode through technological development and knowledge innovation in new fields. Through integrating the dual innovation behavior mode of exploitation and exploration, synergistic effects will be created. At last, the local government should play the role of innovation driver and guide, advocate the spirit of innovation, and create the culture of innovation in the whole society. For example, in the field of talent cultivation and financial and taxation policies, governments should give active support. By creating a better policy environment, it is believed that the entrepreneurial performance and incubation success rate of incubated enterprises can be improved in the future.