This paper adopts the direction distance function and ML productivity index to measure the green total factor productivity green total factor productivity and its decomposition at the provincial level in China from 2003 to 2015 when considering the constraint of energy and environment. The panel model is used to analyze OFDI, environmental regulation and effects of their common forces on industrial green total factor productivity and its transmission mechanism. The results show as follows. Firstly, green total factor productivity growth rate mainly comes from the contribution of technological progress rate. The region with higher environmental regulation intensity corresponds to higher green total factor productivity growth rate. Secondly, for the whole country, OFDI and environmental regulation have a significant effect on the promotion of green total factor productivity, in line with the“Porter hypothesis”, while considering the constraints of environmental regulation OFDI is conducive to play the reverse technology spillover effect and the optimization of the industrial structure then improve the green total factor productivity. Thirdly, OFDI, environmental regulation and the effect of combing forces have obvious“polarization” phenomenon, and the government should reasonably grasp the environmental regulation and make the environmental regulation in line with the moderate standard area. Fourthly, the effect of OFDI has significant environmental regulation, economic development, opening degree and human capital threshold of OFDI.