Abstract: Industry-university integration is a win-win model of cooperation between universities and enterprises, and it is a booster for the economic development of enterprises and regions. The article takes 111 "211" universities and colleges jointly built by the province and ministry from 2007 to 2017 as the research object. Research shows that government-biased scientific research funding can help industry-university integration. Competitive funding has a significant positive role in promoting industry-university integration, especially "985" colleges and universities, "double first-class" construction universities, and universities located in the eastern region have a greater positive role in promoting; non-competitive funding has a significant inhibitory effect on industry-university integration. The analysis of the mechanism of action shows that on the one hand, competitive funding promotes industry-university integration through its direct signaling effects, and on the other hand indirectly promotes industry-university integration through publicly published academic papers; non-competitive funding does not have a significant effect on university research output. Based on this, the article puts forward corresponding policy recommendations.