Abstract:A research of 37 industries panel data of 2003—2010 shows that environmental regulations have a significant positive effect on research & deelopment(R&D) expenditure. Besides, by categorizing 37 industries according to carbon emission and the R&D intensity, we find environmental regulations have a significant positive effect on R&D expenditure for both high and low carbon industry, middle R&D and low R&D industry, “Porter Hypothesis” works here on the whole, which suggest that a “win win” situation will present upon more stringent environmental regulations and the industrial technical innovation in China.