To study the relationship between environmental regulation and regional technological innovation, by using the panel data of seven sub-sectors of equipment manufacturing industry in China’s 31 provinces and municipalities from 2005 to 2016, the system GMM model was used to empirically study the impact of environmental regulation on technological innovation on the basis of dynamic panel model after theoretical analysis. The study finds that, from a national level analysis, there is a “U”-type dynamic feature that first declines and then rises between environmental regulation and technological innovation in equipment manufacturing. And environmental regulation inhibits the promotion effect of foreign capital, enterprise scale and human capital on technological innovation. From regional level, however, there is regional heterogeneity in the impact of environmental regulation on regional technological innovation of the equipment manufacturing industry. The impact of environmental regulation on technological innovation in equipment manufacturing industry only presents “U”-type characteristics in the whole country and in the east area, and has inhibiting effect on technological innovation in the central region while it has a significant positive impact on technological innovation in the west area.