Using Schumpeter’s (1934) Theory of Economic Development, we propose a Schumpeterian based view of ‘green entrepreneurship’. An interdisciplinary literature review reveals a variety of interpretations relating entrepreneurship with the natural environment; however, Schumpeter’s theory provides a theoretical link that bridges these concepts. We extend his five sources of innovation (creating new goods; creating new production methods; capturing new supply sources; creating new markets; or, creating new industries) to propose a typology of green entrepreneurship with examples of how entrepreneurs have implemented natural environment innovations. We contribute to the literature by clarifying green economic development in terms of Schumpeter; extending Schumpeter’s work to explain how environmental progress can be made whilst maintaining economic progress; and separating the types of Schumpeterian innovation by level of analysis to provide a focus for future theoretical and empirical research.