PurposeThis　study　aims　to　construct　a　system　dynamics　model　for　industrial　ecosystems,　focusing　on　the　sustainable　development　of　the　manufacturing　industry.　It　seeks　to　promote　coordinated　development　among　industry,　society　and　nature　by　integrating　interactions　among　stakeholders,　supporting　institutions　and　the　external　environment.Design/methodology/approachThis　study　utilizes　data　from　China＇s　manufacturing　industry　between　2011　and　2018　and　employs　a　system　dynamics　model　to　analyze　the　key　factors　influencing　the　sustainable　development　of　the　manufacturing　ecosystem.　Additionally,　policy　recommendations　are　proposed　based　on　the　synergistic　effects　of　factors　within　three　distinct　subsystems　driving　sustainable　development.FindingsThe　results　demonstrate　a　trade-off　between　industrial　growth　and　environmental　sustainability.　Financial　development　and　technology　import　drive　output　and　innovation　but　increase　pollution　emission　and　energy　consumption.　Resource　recycling　is　key　to　reducing　pollution　emissions　and　fostering　greener　ecosystems.　While　technological　adoption　and　talent　boost　product　growth,　they　fail　to　lower　environmental　impact.　Macro-environmental　improvements　promote　growth　but　add　ecological　pressure.　Therefore,　policies　should　focus　on　green　technologies,　resource　recycling,　environmental　assessments　and　targeted　funding　for　sustainable　innovation　to　achieve　balanced　industrial　development　and　ecological　sustainability.Originality/valueThis　paper　presents　a　generic　system　dynamics　model　for　evaluating　and　guiding　the　sustainable　development　of　the　manufacturing　industry.　It　provides　valuable　insights　for　policymakers　to　identify　key　factors　for　sustainable　manufacturing　development,　understand　the　evolution　of　the　industrial　ecosystem　and　enhance　economic　sustainability　at　the　industrial　level.