China is exploring a high-quality approach to development, which much be based on a sustainable development of resource environment and economy, so it is key to improve ecological environment, to adjust industrial structure and to increase resource allocation efficiency. This paper uses provincial panel data 2001—2016 to analyze the interaction and operating mechanism of environmental regulations, industrial transfer and resource allocation via media effect model based on measurement environmental regulations and resource allocation efficiency. Environmental regulation promotes industrial transfer with a weak upside-down U shape, and improves resource allocation over regions. Industrial transfer acts as media variable, environmental regulations push industrial transfer, which indirectly improves resource allocation efficiency. Governments shall make effective environment regulation to lead industrial transfer over areas so as to decrease wrongly-allocated resources.