This report focuses on innovation in the professional practice of vocational education and training (VET) staff who are directly involved in the teaching and learning functions of Australian VET organisations. It is the first part of a project designed to develop a clearer knowledge and understanding of innovative approaches to teaching, learning and assessment in VET. It provides a national review of good practice and reveals the quality and scope of current innovation in teaching and learning practices in VET. The report is based on research that is guided by the following key ideas about innovation: that the implementation of new ideas improves existing educational services; that innovation is a sequence of activities beginning with creativity and culminating in implementation; that there are different types of innovation; and that there are distinguishing features of innovation in action that are distinct from organisational change in general. The research methodology involved a literature review, interviews, focus groups and case study research. Key findings about innovation in VET teaching and learning are that: (1) more innovation is needed in the national training system; (2) innovation is required to meet the many needs of different learners; (3)innovation results from practitioners' skills and actions; (4) innovation can be fostered or impeded by many factors, e.g. senior management in registered training organisations (RTOs), availability of resources, VET system factors, staff resistance, and student opposition; (5) many parties gain from innovation; and (6) much can be done to further support innovation.