Improving financial innovation and risk management in banks requires a combination of technology, training, smart supervision, and collaboration with financial ecosystem players. Banks that systematically implement these solutions not only reduce their risks, but also better exploit market opportunities. Given the importance of this issue, the present study analyzed and examined the impact of financial innovation on the risk management of banks listed on the Tehran Stock Exchange. For this purpose, data from 17 listed banks on the Tehran Stock Exchange for a ten-year period (from the beginning of 2015 to the end of 2014) were extracted, research variables were calculated, and necessary statistical tests were performed. The present research method is descriptive-correlational and its design is experimental and uses a post-event approach. In the following, in order to test the research hypothesis, multivariate linear regression is used. The research findings indicated that financial innovation has a positive and significant effect on banks' risk management.