Abstract: Using industrial structure rationalization and advancement to measure industrial structure optimization, based on panel data of 30 provinces and cities in China from 2004 to 2016, this paper investigates the influence of the specialization, diversification and integration agglomeration of service industry on industrial structure optimization. The findings are as follows: on the whole, although specialization agglomeration hinders the rationalization of industrial structure, it can promote the advancement of industrial structure; diversified agglomeration not only hinders the rationalization of industrial structure, but also hinders the advancement of industrial structure, which is not conducive to the optimization of industrial structure; the integration agglomeration promotes the rationalization and advancement of industrial structure, which is beneficial to the optimization of industrial structure. As far as the different regions are concerned, specialization and diversification agglomeration have negative effects on the rationalization of industrial structure , which increase in intensity from east to west; what’s more, they restrain the industrial structure of eastern China, but promote the industrial structure of central and western China; the integration agglomeration has a positive effect on the rationalization and advancement of industrial structure in the eastern and western China, and the western China is significantly higher than the eastern and central China.