Low-carbon city pilot is an important institutional arrangement to achieve the goals of carbon peaking and carbon neutrality. However, the policy effect of low-carbon city pilot policies under different diffusion modes on improving environmental quality is not clear. Based on the panel data of 281 prefecture-level cities in China from 2003 to 2019, this study regards the three batches of low-carbon city pilots as quasi-natural experiments, and uses the time-varying DID method to evaluate the differential effects of low-carbon city pilot policies on improving environmental quality under different diffusion modes. The results show that (1) The construction of low-carbon city pilot significantly reduces the air pollution level and contributes to the improvement of environmental quality. (2) The air pollution control effect of low-carbon city pilot under hierarchical diffusion mode is better than that under active diffusion mode. (3) The effects of low-carbon city pilot under hierarchical and active diffusion modes on improving environmental quality show obvious heterogeneity among different levels of economic development and different types of cities. This study provides useful policy implications for further fighting the battle of pollution prevention and control and building a beautiful China with harmonious coexistence between man and nature.