In the 21 century, with the fast growth of gross domestic product, China has become the second largest economy only after the United States. In 2000, the shares of industrial composition in GDP were 15.06%, 45.92% and 39.02%. Even in 2012, the proportions of them were still as high as 10.10%, 45.30% and 44.60%. However, in the same year, the corresponding shares in America were 1.20%, 19.10% and 79.70 respectively, and the world averaged values of these shares are 5.90%, 30.50% and 63.60%. Zhang (2012) points out that China's industrial structure is so poor when considering from the shares of the three crucial sectors of industrial structure at present. According to the famous Petty-Clark's Law, generally speaking, the proportion of the tertiary industry in GDP will increase with the development of economy and optimization of industrial structure. Roughly, it provides us a standard to judge the industrial structure optimization. Therefore, China's industrial structure is disproportional and the process of industrial structural optimization in China is rather slow. In this essay, we will attempt to evaluate the level of industrial optimization for China's 29 provinces. Furthermore, we will try to find out the role of the government in the course of optimizing the industrial structure and explain the correspondent mechanism. Panel-data of all 29 provinces are used for the period of 1992 to 2013. Previous studies mainly focused on the non-government factors which impact industrial structure optimization, such as FDI and technology, and only a few had considered the role of government intervention. However, due to the fact that China is a special country whose government plays an important role in the economic development, Chinese government's role in the process of industrial structure optimization is worthy of studying. In this thesis, we take FDI and technology as the control variables and the most fundamental purpose of the work is to estimate the influence of government intervention on industrial structure. The statistical result of Moore index shows the measurement of industrial structural optimization for the selected 29 provinces in China. The total averaged value is 0.837 compared to 0 in base year 1992, which indicates a more optimized industrial structure compared to the base year. And Moore values in all the years are positive, which means that the industrial structures in all years are better than that in 1992. The empirical estimation shows that the effect of government intervention on industrial structure optimization depends on the development level of market. In the under-developed market, government intervention exerts a positive effect on industrial structure optimization, while in the relatively developed market, the result would be the opposite. As for the control variables FDI and technology, both of them have positive effects on industrial structure optimization. In the end, we discuss some policy suggestions. Key words: Industrial structure optimization, Moore index, Government intervention