Entrepreneurship and innovation tend to serve as vehicles to provide solutions to economic woes during recession without relying upon public resources. The article discusses the definition of social entrepreneurship and shows how social entrepreneurship has developed at the relation of private, public, and nonprofit sectors. It outlines main trends in social entrepreneurship, and highlights successful entrepreneurial initiatives in solving social problems. The paper also examines how social entrepreneurship can help government to benefit society and improve lives. Government and social entrepreneurs have a common goal to solve social problems in effective and efficient way. However, little has been researched on this relationship. The presented article emphasizes that government can support social entrepreneurial initiatives in various ways to encourage social entrepreneurs to innovate, as well as create enabling environments for their efforts to solve problems in society.