The　concept　and　theory　of　ecological　compensation　(EC)　have　been　widely　studied　in　the　past　20　years,　but　its　practical　effects　have　not　yet　been　agreed　upon.　Based　on　a　panel　data　from　281　prefecture-level　cities　in　China　from　2009　to　2018,　this　paper　examines　the　impact　of　air　ecological　compensation　(AEC)　policy　on　air　pollutant　emissions　and　its　mechanism　with　time-varying　DID　model.　The　study　found　that　AEC　will　reduce　the　emissions　of　sulfur　dioxide,　PM2.5,　industrial　smoke　and　dust,　which　remained　significant　after　a　series　of　robustness　test.　Mechanism　analysis　concluded　that　AEC　can　reduce　air　pollutant　emissions　mainly　by　promoting　green　technology　innovation,　strengthening　pollution　treatment　intensity　and　improving　energy　efficiency.　The　effect　of　AEC　varied　with　city　characteristics,　in　cities　with　high　proportion　of　Industrial,　low　environmental　regulation　intensity　and　high　fiscal　pressure,　AEC　have　significant　or　better　policy　effects,　while,　AEC　does　not　have　significant　policy　effects　in　cities　with　high　environmental　regulations　intensity　and　low　financial　pressure.　China　should　consider　further　promoting　the　pilot　scope　of　AEC,　but　it　also　needs　to　improve　the　compensation　standard　and　compensation　mechanism　to　achieve　better　policy　effects.