Bruce Nussbaum has recommendation for 10 books on innovation. I think it is a great list. 
Here goes for the 10 top books on innovation for 08:
1- The Opposable Mind: How Successful Leaders Win Through Integrative Thinking by Roger L. Martin.
2- Prophet of Innovation: Joseph Schumpeter and Creative Destruction by Thomas K. McCraw.
3- Meatball Sundae: Is Your Marketing Out of Sync? Seth Godin.
4- The Design of Future Things by Don Norman.
5-Innovation Nation by John Kao.
6- Wikinomics: How Mass Collaboration Changes Everything by Don Tapscott and Anthony D. Williams.
7-The Future of Management by Gary Hammel.
8- Made to Stick: Why Some Ideas Survive and Others Die, by Chip Heath and Dan Heath.
9- The Laws of Simplicity by John Maeda.
10- Everyday Engineering: What Engineers See, by Andrew Burroughs.
NussbaumOnDesign 10 Best Books On Innovation To Get You Through The Recession. – BusinessWeek
