This full research paper presents the development of the Innovation-Based Learning (IBL) Framework, the first framework to integrate innovation and learning within engineering classrooms. Engineering programs across the world are looking for ways to develop innovative engineering students. Work has been done in engineering education to develop qualitative frameworks and best practices for teaching, but these frameworks and practices do not align with many of the complexities of teaching innovation. Both the engineering education and research community could benefit from the creation of a framework that integrates technical innovation and learning in engineering because it would help drive development of best practices in teaching engineering innovation and lead to stronger research in this area. This work details the development of such a framework by using data from an Innovation-Based Learning course and the alternate templates strategy. The framework is simple enough that it includes only seven categories, generalizable enough that it can fit multiple students from multiple groups working on multiple projects, and accurate enough that there is sufficient interrater reliability. The final product is a framework that focuses on the divergent and convergent behaviors of innovation and learning. The IBL Framework has implications for both instructors teaching innovation and researchers studying innovation in educational settings. The framework gives instructors and students a unifying vocabulary about the process of learning innovation, and it allows researchers to sort student actions into illustrative categories. Ultimately, the framework can lead to unifying best practices when teaching and researching innovation in classroom settings.