This paper explores geographical variations in innovation activity in Norwegian manufacturing industry, and examines in particular the characteristics of innovation activity in the most peripheral parts of the country. This is an important topic when innovation is regarded as a territorial phenomenon: The innovation process is in part based on resources that are location-specific - resources which are tied to particular places and cannot easily be transferred or reproduced elsewhere. Thus, innovation is generated differently in different regions, depending on the firm and industry structure, the composition of the regional innovation system, as well as on varying social and cultural conditions. It is essential to understand the way in which innovations occur in different regions, in order to develop a regional innovation policy tailored to suit varying local conditions. In the Norwegian context it is a special challenge to develop innovation policy for ultra-peripheral regions. This paper uses Finnmark, the most northern county in Norway, as an example of this kind of region. The paper explores strong and weak parts of the innovation system in Finnmark, and suggests innovation policy initiatives suited for ultra-peripheral regions. As an introduction to the Finnmark study, we first expose some key features of the pattern of geographical variation in innovation activity in Norway as a whole.