To explore the influence of China's new urbanization development on industrial water efficiency, this article uses epsilon-based measuremodel and entropy method to calculate industrial water efficiency and the level of new urbanization development based on the paneldata of 30 provincial cities in China from 2011 to 2020. On this basis, the spatial econometric model and the panel threshold model are con-structed to explore the spatial spillover effect and threshold characteristics of new urbanization development on industrial water efficiency.The results show that there are large regional differences in new urbanization development and industrial water efficiency, and the easternregion is better than central and western regions. New urbanization development shows a significant positive spatial correlation and has apositive spillover effect on the improvement of industrial water efficiency. Affected by the level of new urbanization development, the pro-motion effect of new urbanization development on industrial water efficiency is different. After crossing the threshold, the promotion effect isenhanced. According to the research conclusion, it is suggested that local governments at all levels should formulate development policiesaccording to local conditions, strengthen the construction of new urbanization, promote scientific and technological innovation, rationalizeindustrial structure, and improve industrial water efficiency.