<p>Industrial structure optimization is an important manifestation of sustainable development, but more empirical evidence is needed to support whether it can effectively reduce carbon emissions. This is also related to the current important international issue of how to achieve economic growth while reducing carbon emissions? This study focuses on 31 provincial regions in China over the period from 2011 to 2021, empirically analyzing the relationship and mechanism between regional industrial structure optimization and carbon emissions, considering both the rationalization and advancement of the industrial structure. The findings indicate that optimizing the industrial structure can lead to reduced carbon emissions, with green regulation, technology, and finance serving as mediators in this process. It is worth noting that green finance has a masking effect between the industrial structure advancement and carbon emissions. Further research finds that there are differences in carbon reduction between industrial structure rationalization and industrial structure advancement in different regions of China. In addition, the carbon reduction effect of industrial structure optimization is more obvious when the government has an advantage in the game with the market. In general, the optimization of industrial structure can reduce carbon emissions. It requires the elimination of backward production capacity to achieve industrial upgrading. It also requires government policy guidance to provide financial and technical support and consider implementation scenarios based on local conditions.</p>