I'm not, professionally, interested in its research direction so I don't pay attention to its research really. :: spreads hands ::
The Media Lab has a long history of innovations that you've probably heard of: E-ink, Formlabs (3D printers), RockBand/GuitarHero, the touchstick on IBM Thinkpads, OLPC, Lego Mindstorms, and Scratch were all developed there.
That's pretty good for an organization with a budget of $75M and a permanent staff of 80. I'd be hard-pressed to think of an organization of similar size that's had greater impact - maybe YCombinator or Stanford's CS department. Bell Labs was orders of magnitude bigger - in their 1970s heyday they had 24,000 employees and a budget of around $6B in today's money.
EDIT: Bell Labs started out with 4K employees so it was always an order of magnitude bigger.
Maybe Media Lab is the biggest innovator for its size. I don’t know if that means much though if it is. Bell Labs gets brought up probably because their influence and what they’ve done far far exceeds the budget and head count advantage.
(I worked on all three projects.)