While data drives economic and social development, it also poses challenges to the effectiveness of traditional regulatory systems. The implementation of data regulation through data protection laws has emerged as a global trend. This paper utilizes cross-national panel data from 203 countries (or regions) spanning from 2006 to 2023 and employs a time series Event History Analysis model to investigate the impact of the domestic institutional environment and international institutional cooperation on the diffusion of data protection laws. The study reveals that a strong rule of law and participation in the European Union’s international data regulation system positively influence the adoption of data protection laws, with a substitution relationship observed between these two factors. Additionally, the impact varies at different levels of economic development and digital trade openness. This study enriches the empirical literature on data regulation and highlights that domestic institutional environment and international institutional cooperation jointly affect the diffusion of global data regulation. This study offers policy insights for China in establishing a robust data regulation system and enhancing data governance capabilities.