<p>Optimizing the vertical division of environmental responsibilities helps overcome free-riding behavior and regulatory fragmentation in border regions, thereby internalizing pollution externalities. This study employs panel data from 221 prefecture-level cities located along inter-provincial borders in China from 2011 to 2022, and applies a multi-period difference-in-differences model to examine the impact and underlying mechanisms of the vertical management reform of environmental protection institutions (VREP) on air pollution in these areas. The findings indicate that following departmental restructuring and the redistribution of administrative responsibilities, air pollution levels in border cities have decreased significantly, with the extent of improvement gradually increasing over time. This positive change is primarily driven by enhanced regulatory capacity and intensified environmental law enforcement. Furthermore, heterogeneity analysis further reveals that the pollution control efficacy of VREP is more pronounced in cities with stronger border attributes, higher coordination levels, or those classified as non-national border cities. The decomposition of spatial effects indicates that the current mitigation of pollution in border areas is primarily attributable to the improvement of local environmental governance capacity. Future efforts must prioritize deepening regional coordination to unlock its potential.</p>