Employing firm-level data during the period of 1980-2006, this paper analyzes the R&D efficiency of IT SMEs. We focus on comparing the R&D efficiency of IT SMEs with that of large-sized IT firms and non-IT SMEs. The results are summarized as follows. First, the R&D investment of IT SMEs has not been increased since 2000. In IT manufacturing industry, the portion of the R&D investment of IT SMEs is no more than 10.6% in 2005. Second, we analyze the innovation capacity of SMEs with the number of the patent application. The result is similar with the trend of R&D investment. The portion of the patent application of SMEs has not been increased since 2000. Third, the R&D efficiency of non-IT firms is higher than that of IT SMEs regardless of the firm size. The R&D efficiency of non-IT SMEs is over three times as large as that of IT SMEs. Meanwhile, The R&D efficiency of the large-sized non IT firms is 1.86 times as large as that of IT large-sized firms. Finally, we estimate the R&D elasticity and compare between IT manufacturing and service industry. The result shows that the R&D elasticity of IT service industry is higher than that of IT manufacturing industry, regardless of firm size.