With the continuous infiltration of clan culture into enterprises, Chinese enterprises inevitably face the institutional complexity brought by the coexistence of clan culture logic and enterprise logic. How to effectively deal with the institutional complexity in the process of technological innovation presents a theoretical puzzle. In response, we propose a theoretical framework to examine the role of clan culture in technological innovation anchored on strategic response to institutional complexity viewpoint. Through the analysis of a survey and archive dataset of 193 firms in China, we find clan culture has an inverse U-shaped effect on technological innovation performance; Resource flexibility mediates the inverse U-shaped effect of clan culture on technological innovation performance; Coordination flexibility mediates the inverse U-shaped effect of clan culture on technological innovation performance; Regional financial development enhances the positive impact of clan culture on technological innovation performance when the level of clan culture is low, and also enhances the negative impact of clan culture on technological innovation performance when the level of clan culture is high. Taken together, our results substantiate the influence mechanism of clan culture on technological innovation, correct the negative cognitive bias on clan culture in current China, and provide practical implications for Chinese local technological innovation management.