Agglomeration economy is an important source of growth for local economy and an important carrier for enhancing the competitiveness of local economy. Most of China's manufacturing industries are highly geographically concentrated with inter-provincial differences and obvious industry differences. Environmental efficiency shows a downward trend. Environmental efficiency in the eastern region is high and environmental efficiency in the central and western regions is low. Manufacturing agglomeration levels and environmental efficiency demonstrate significant N-type relations and different evolution stages of manufacturing agglomeration have different impacts on environmental efficiency. Economic growth, industrial structure, technological progress, environment protection awareness, government regulation, urbanization and the level of opening up are all important factors affecting environmental efficiency. In order to promote the transformation of economic growth mode, improve environmental efficiency and achieve sustainable development, we should speed up the concentration and upgrading of manufacturing industries, adhere to the green development, optimize the industrial structure adjustment, enhance the capability of independent innovation and raise the threshold for foreign investment accessing to the environment.