Ever since the 1992 United Nations Earth Summit, the pursuit of sustainable development has been the common goal of nations around the world. The partnership relationship of the industry-environment has been declared clearly to be the goal of the sustainable development supported by balancing growth in economic development with environmental protection. Adopting the values of sustainable development implies an increase in the industry’s environmental and social costs1 . For developing countries already struggling to provide basic needs, the extra environmental costs could potentially hinder further industrial development. In theory, the relationship between environmental goals and industrial competitiveness has been thought of as involving a tradeoff between social benefits and private costs. However, in practice, the role of regulation induced technological innovation in the course of industrial transition may help to avoid or reduce negative environmental impacts, while at the same time promoting economic efficiency thereby lowering the costs of the environmental improvements. This paper assesses the economic structural changes, industrial transition on the sustainability in the developing countries. The weak form of the Porter Hypothesis is examined under industry cycles and structural changes. This paper investigates the existing and potential environmental impacts of industrial transition and economic structural changes. We analyze the relationships between industrial transition, economic structural changes and environmental impact assessment. The scope and characteristics of the economic structural changes and industrial transition in the developing countries are considered and whether it’s corresponding to the principles of sustainable development is examined. In exploring industrial competitiveness and sustainable development, we aim at both industrial competitiveness and sustainable development for balanced growth. The purpose is to design effective sustainable development strategies to stimulate innovation and ask the following questions: What are the determinants for the sustainable development? What should be the future direction and strategic industrial planning based on sustainable development?