This paper uses carbon emission decomposition model to measure the carbon emission of industrial development in northern Jiangsu, and applies expanded STIRPAT model to analyze its factors, and employs carbon emission potential index model to study the reduction potential of industrial carbon emission. Industrial carbon emission intensity has gradually declined in northern Jiangsu, lower than the average in China, mostly contributed from power, mining, metallurgy, petroleum refinery and paper industries in Xuzhou and Huai'an. The factors impacting industrial carbon emission in northern Jiangsu include energy consumption intensity, industrial economy scale and industry structure, followed by the living standard of residents and urbanization level. The key industries with great potential in industrial carbon emission reduction are power, mining, petroleum refinery, chemicals and medicine, metallurgy, equipment manufacture, paper industries in Xuzhou, Huai'an and Lianyungang. This paper presents suggestions on establishing carbon emission objectives and responsibilities for key industries, enhancing carbon emission controls, exerting carbon emission reduction potential, and promoting industrial energy saving and advancing in northern Jiangsu province.