Carbon　peak　targets　play　a　crucial　role　in　the　global　effort　to　mitigate　climate　change,　with　profound　implications　for　green　and　sustainable　economic　growth.　This　research　explores　the　dynamics　between　carbon　peak　target　policies　and　urban　low-carbon　development　using　a　novel　delegation-agency　framework　between　central　and　local　governments.　Analyzing　data　from　U.S.　climate　action　plans　spanning　2010–2020,　we　employ　an　advanced　difference-in-differences　approach　to　elucidate　the　causal　impact　of　carbon　peak　targets　on　low-carbon　transitions.　Our　findings　demonstrate　a　significant　positive　correlation　between　the　adoption　of　these　targets　and　accelerated　low-carbon　development,　with　effects　modulated　by　local　economic　structures,　resource　availability,　and　governance　transitions.　The　robustness　of　these　results　is　rigorously　validated　through　a　comprehensive　series　of　tests,　including　placebo　experiments,　policy　interference　controls,　and　heterogeneity　bias　assessments.　Further　investigation　reveals　that　carbon　peak　targets　primarily　function　through　two　key　mechanisms:　stimulating　eco-innovation　and　catalyzing　green　infrastructure　investments.　Notably,　our　analysis　uncovers　an　inverse　relationship　between　target　timeline　stringency　and　low-carbon　transition　effectiveness.　This　study　advances　the　field　by　offering　a　unified　theoretical　framework　for　analyzing　local　government　constraints　and　carbon　peak　targets,　conducting　granular　city-level　analyses,　and　exploring　the　nuanced　impacts　of　policy　design　features.　Our　findings　suggest　several　policy　prescriptions,　including　recalibrating　municipal　performance　metrics,　advocating　for　flexible　target　frameworks,　and　fostering　synergies　between　environmental　policies　and　innovation　ecosystems.　These　insights　provide　valuable　guidance　for　policymakers　aiming　to　optimize　climate　strategies　and　accelerate　the　transition　to　a　sustainable,　low-carbon　economy.　©　2025　The　Authors