This study, based on social network theory, examined the impact of social capital on knowledge capital and, in turn, innovation. In addition, we argued that social capital influence the innovation by way of the mediator effect of knowledge capital. The empirical data was collected from 683 employees of a R&D institute by network survey approach. The results show that social capitals have positive impact on knowledge capital, and the innovation. Meanwhile, the knowledge capital serves as the mediator between the social capital and innovation. We conclude the study with some suggestions for both practice and further researchers.