Based on New Economic Geography,this paper adopts simultaneous equations to analyze the influencing factors of labor mobility and the tertiary industry and the endogeneity between labor mobility and the tertiary industry using China′s provincial panel data from 2006-2009.Results show that economic income,development of the tertiary industry and economic openness are the major determinants of labor inflow.With the increasing of the rural net income and the decreasing of the gap between urban and rural areas,labor mobility is reduced;capital,labor and market factors promote the development of the tertiary industry;policy constraints obstruct the development of the tertiary industry,and the urbanization strategy in different development stages of different regions has different effects;and the interaction of the labor mobility and the tertiary industry leads to aggregation effect of labor in China′s eastern region.