Hutton, Marcus and Tehranian (2009) show that in order to get higher compensation and protect their jobs, managers are prone to withhold bad information to make their firms overvalued. Once the accumulated bad information reach to tip point, the bubble will burst. When receiving extremely negative information, investors revise downward their expectations substantially and the stock price follows, which leads to a stock price crash. Meanwhile, Hou and Robinson (2006) present that a firms in less concentrated industries earn higher returns because larger competition in those industries exposes firms to larger undiversifiable distress risk. The two recent researches on product market structure and stock price crashes leave a small blank area between them. To fill the gap in the literature, this study investigates the relationship between the industry concentration and stock price crashes. Herfindahl-Hirschman Index (HHI) is used to measure industry concentration, and CRASH, NCSKEW and DUVOL are used to measure stock price crashes in this study. Examining a large sample of U.S. firms for the period 1963-2011, this study finds that there is a significant negative correlation between the industry concentration and stock price crash risks. This suggests that industry concentration affect stock price crash risk through a cash flow channel. Then, further analysis finds a consistent result that there is a significant negative correlation between industry concentration and cash flow downside risk. This confirms and verifies the main results. In a subsample tests, the results show that the effect of industry concentration on stock price crash risk is stronger on small firms or follower firms because of their lack of ability to absorb the cash flow risk.