<p>As global urbanization speeds up, smart city construction has become crucial for improving urban management and elevating residents’ life quality. Its impact on urban livability is now a key issue in urban planning and public policy. This study treats smart city policy (SCP) implementation as a quasi-natural experiment, using panel data from 284 Chinese cities from 2003 to 2019. A time-varying DID model is used to quantify SCP’s effect on urban livability and to examine their transmission mechanisms. The findings show that: (1) SCP significantly improves urban livability, as verified by a series of robustness tests; (2) SCP has a stronger positive impact in larger cities, non-resource-based cities, and cities with higher human capital; (3) Technological innovation and government social governance are key pathways through which SCP enhances urban livability; (4) SCP has positive spillover effects that improve livability in surrounding non-pilot cities. These findings offer valuable insights for policymakers on optimizing resource allocation and increasing the effectiveness of smart city initiatives and provide a sound empirical basis for future urban transformation strategies in China.</p>