Pollution Reduction, Informatization and Sustainable Urban Development—Evidence from the Smart City Projects in China

China’s modernization endeavors to advance both material and spiritual civilization concomitantly; nevertheless, the nation presently faces a pressing issue of urban pollution. This research examines how the introduction of information technology has affected environmental pollution in Chinese cities. By utilizing a panel dataset consisting of 214 prefecture-level cities in China spanning from 2005 to 2017, we employed a time-varying DID model with smart city pilot projects serving as a quasi-natural experiment to assess the impact of informatization on environmental pollution. The establishment of smart cities has remarkably elevated the information quotient of urban areas. Additionally, the results indicate a significant reduction in pollution levels in urban areas as a result of informatization, which remained robust even after conducting a series of rigorous tests to ensure the reliability of the findings. Mechanism analysis shows that informatization of smart cities affects the environmental governance behavior of enterprises and governments. Consequently, the implementation of informatization in smart cities can effectively alleviate environmental pollution by means of both the technique effect and structure effect. This finding calls for the Chinese government to improve informatization by promoting smart city pilot projects to build sustainable cities.