Environmental challenges in search of new economic efficiencies stress the necessity of a fundamental change of economic model. The goal of accelerating the EU’s industrial and technological development must be close to decoupling economic growth from resource consumption. Based on fixed effect panel models, the study aims to empirically test the relationship between growth and eco-innovation in EU countries from 2000–2020. The analysis finds evidence of a significant long-term relationship, indicating the presence of cointegration between ecological innovations and economic growth. The results underscore the existence of a positive correlation for some of the selected indicators measuring the environmental transformation of economies. Different countries demonstrate different strengths of the growth-eco-innovation relationship, which also indicates different effectiveness of eco-policies within the EU, as well as still strong heterogeneity between countries. The added value of this research is in drawing attention to the growing importance of eco-innovation as a driver of economic growth suggesting that green innovation can act as a catalyst for sustainable development. Such measures would create an enabling environment that encourages and supports the implementation of green technologies and practices, fostering a transition towards a more sustainable and resilient economy.