Patents play a significant role in technology innovation by providing legal protection for new inventions. They grant inventors exclusive rights to their creations for a specific period, encouraging research and development by ensuring that innovators can potentially profit from their ideas without fear of copying. This fosters an environment where companies and individuals are motivated to invest in novel technologies, knowing their intellectual property will be safeguarded. However, the challenge lies in the balance between protecting inventions and ensuring that innovation is not stifled by overly broad or aggressive patent practices, which can hinder competition.