Abstract: This paper examines whether technological innovation has improved the scale of China's middle class. Using the data of China Family Panel Studies (CFPS) from 2010 to 2020, this paper examines the heterogenous effects brought by different innovation paths. It is found that technological innovation has significantly increased the size of the middle class. However, public innovation and private innovation, have different impacts on the evolution of the middle class. Public innovation, which has no biased effect, increases the scale of both skilled and non-skilled middle class, while private innovation, which has a biased impact, improves the scale of skilled middle class rather than non-skilled middle class. This paper also shows China’s institutions has magnified the positive effect of technological innovation on the expansion of middle class, which proves the key role of the government in improving both innovation and common prosperity. This study provides a useful idea for expanding the scale of middle class and promoting common prosperity. Compared with the existing studies, the possible marginal contribution of this paper is mainly reflected in the following aspects: First, from the perspective of national innovation system, we compare and analyze the differential impact of public innovation and private innovation on the middle class. Second, we examine the internal heterogeneity of the middle class from different perspectives. Current literature mainly measures the middle class from the perspective of income, while this paper further divides the middle class into skilled middle class and non-skilled middle class from the dimension of occupation, and then discusses the differentiated impact of technological innovation on different middle class. Third, under the socialist economic system in China, the state-led innovation development strategy may strengthen the positive effect of technological innovation on the expansion of the middle class, and finally make the scale of the middle class grow with technological innovation. This paper makes an in-depth investigation about the feasible path of technological innovation to expand the scale of middle class and promote the common prosperity. The analysis shows that, in order to realize the effective growth of the middle class, we should pay attention to the key role of public innovation led by the government. The public sector and the private sector play different roles in creating, producing and disseminating innovation. In order to maximize the social benefits brought by innovation, the government and the private sector should build a mutually beneficial innovation system. In the field of technological innovation, the enterprise is undoubtedly the most important innovation subject, however, under the spontaneous operation of the market, the enterprise innovation may have a biased impact on the distribution of labor income, and it is difficult to achieve shared growth. Therefore, it is necessary to reasonably define the boundary of technological innovation between the government and the market, and construct forward-looking and overall strategic planning for innovation and development. While allowing the market to play a decisive role in resource allocation, the government should strengthen its support and leading role in technological innovation in the field of national economic and social development.