This study aims to further investigate the mechanism of environmental regulations impacting on the green development of industries. The results show that environmental regulations can induce R&D investment on green or clean technology and then promote the green productivity growth; from the decompositions of GML index, the inducement of environmental regulations is reflected on the promotion of green technology, rather than green efficiency improvement; the inducement of environmental regulations is different between the polluted industries and the clean industries. The conclusion can be helpful to understand the mechanism of the “Potter Hypothesis” in the economy of transformation, and thus can provide a policy hint for the construction of ecological civilization in China.