Abstract: Based on the inter-provincial panel data from 2004 to 2015, this paper studies the differential influence of innovation quantity and innovation quality on the transformation and upgrading of industrial structure(TUIS) from the perspective of institutional quality. The study found that: (1) The innovation quantity could significantly promote TUIS, while the innovation quality has no significant effect due to its lower level; (2) The coordinated development of innovation quantity and institutional quality did not promote TUIS, while innovation quality and institutional quality did; (3) The innovation quantity has a single institutional quality threshold 4.9200 for the industrial structure advancement(ISA). With the institutional quality exceeds the threshold, the impact of innovation quantity on ISA will change from negative to positive, while the innovation quantity does not have an institutional quality threshold for industrial structure rationalization(ISR); (4) The innovation quality has double institutional quality threshold 5.4486 and 6.7066 for ISA and a single institutional quality threshold 7.5419 for ISR. As the institutional quality exceeds the threshold, the impact of innovation quality on ISA and ISR will Change from negative to positive; (5) The institutional quality threshold of innovation quality for TUIS is higher than that of innovation quantity. The institutional quality threshold for ISR is also higher than ISA. In the future, China will need to spare no efforts to improve the innovation quality and accelerate the process of market-oriented construction in order to promote TUIS with high-quality innovation.