Abstract: Countries around the world are increasingly concerned about grand social challenges including climate change, aging, and global pandemics, all of which may negatively affect people’s life and well-being. These “wicked” challenges are complex, systemic, interconnected, and urgent. Traditional innovation policy systems are unable to effectively deal with them due to a lack of holistic strategic orientation and policy coordination, as well as fragmented policy instruments. Policymakers global wide are looking for a new systemic policy intervention to achieve transformational societal changes. In this context, many countries have been experimenting with a systemic intervention to give a long-term orientation to innovation support, usually referred to as ‘mission-oriented innovation policy’. Mission-oriented innovation policy is a new policy paradigm that has emerged in response to grand societal challenges and has become a systematic policy intervention solution to “urgent, difficult, dangerous, and critical” scientific problems in many countries. It emphasizes mission-directed orientation, encompasses a variety of policy instruments and combinations, and involves multiple sectors, disciplines, and actors. Although the attention of mission-oriented innovation policy is rising, it has not been fully explored as a new policy paradigm. Prior studies have not reached a consensus on the concept, connotation, constituent elements, and main characteristics of mission-oriented innovation policy, nor have they clearly explained the legitimacy of its intervention in innovation activities. In light of the above gaps, this paper focuses on three aspects. First, we construct an analytical framework of mission-oriented innovation policy and present a comprehensive analysis of its concept connotation, element composition, main characteristics. Second, we explore the legitimacy of mission-oriented innovation policy interventions in innovation activities through an explanation of the four types of failures (directionality failure, demand articulation failure, policy coordination failure, reflexivity failure) contained in transformational failures. Finally, we take the US Apollo program, China's new energy vehicle program, and the European Union's "Horizon Europe (2021-2027)" program as examples to conduct in-depth discussions on three typical mission-oriented innovation policy practices. The results show that mission-oriented innovation policy is mainly composed of policy objectives, policy subjects, policy instruments, and policy processes, and is characterized by direction guidance, market creation, collaborative participation, and dynamic evaluation. Transformational failure theory provides a theoretical explanation for the legitimacy of mission-oriented innovation policy intervention in innovation activities. Mission-oriented innovation policy can solve the problems of directionality failure, demand articulation failure, policy coordination failure, reflexivity failure contained in transformational failures by guiding innovation direction, shaping the new market, and coordinating the participation of a wider range of actors. The existing practice of mission-oriented innovation policy focuses on three areas: ensuring national defense and security, achieving industrial catch-up, and addressing grand social challenges. These three policy practices reflect that a country has different urgent problems in different development stages and environments, resulting in different dominant strategic missions. Our work can provide theoretical support and empirical reference for the formulation and implementation of mission-oriented innovation policies in China. With the frequent occurrence of challenges today, China must enhance the awareness of opportunities and accelerate the improvement of the mission-oriented innovation policy system under the special scenario. This is not only an important measure for China to effectively deal with unstable factors in the international context but also a strategic choice for major missions such as safeguarding national industrial security and breaking through foreign technology blockades.