This paper analyzes the effects of environmental policy on economic growth and pollution in China by the grouped VAR model.It shows that the environmental policy does not essentially change the current situation that eco- nomic growth exacerbates pollution and pollution limits economic growth.The reason is that China' s environmental poli- cy is not fully enforced,mainly in an ex-post governing way,which cannot effectively reduce the environmental cost of economic growth.Therefore,to make economic growth better and faster,the government should stress on the ex -ante regulation and reinforce the implementation of environmental policy.