Abstract: From new economic geography and city economics theory, using statistical data from 285 cities in 2003-2012, this paper studied the spatial spillovers effect of industrial agglomeration and market potential on regional wage using spatial econometric model. The results showed that there was a increasing growth in the space correlation of average worker wage and the wage gap between different cities became larger. The effect of manufacturing industry agglomeration on regional wage level was significantly negative. Producer service industry agglomeration significantly promoted the level of wage. The effect of market potential on regional wage was significantly positive; with the increase of geographic distance, the effect of market potential on regional wage were “N” type. From the perspective of agglomeration externality, the effect of MAR externality and Porter externality on regional wage level was significantly negative, Jacobs externality promoted the regional wage level and this meant that the negative effect of manufacturing industry agglomeration was mainly due to MAR externality and Porter externality.