Green competitiveness, as a new idea to break the constraints of resources and environment and cultivate competitive advantages, has become an important part of China’s high-quality economic and social development. Based on the empirical facts of the evolution of river chief system, this paper uses the double difference method to identify the role of China’s environmental policy innovation on urban green competitiveness. It is found that the river chief system has an indigenous effect on the improvement of urban green competitiveness, and shows heterogeneity in time and space. In addition, the river chief system has an indirect impact on the green competitiveness of cities mainly through three channels: inducing green technology innovation, reducing pollution emission intensity and promoting economic transformation and upgrading.