Using panel data of 284 cities at prefecture level and above in China from 2003 to 2022, this paper takes the National E-commerce Demonstration Cities (NEDC) as a quasi-natural experiment, employs the staggered difference-in-difference (DID) model to examine the impact of the NEDC policy on regional economic disparities (RED), and explores the mediating roles of factor and commodity market integration. The main findings are as follows: First, the NEDC policy significantly narrows RED, which still holds after a series of robustness tests. Second, the mechanism analysis demonstrates that the NEDC policy mitigates RED by fostering both factor and commodity market integration. Third, the inhibitory effect of the NEDC policy on RED is more pronounced in non-eastern cities, southern cities, commercial-based cities, ordinary prefecture-level cities and good business environment cities. Fourth, the NEDC policy exhibits a significant synergistic inhibitory effect on RED within 150 km radius of the demonstration cities. Moreover, the inhibitory effect of the NEDC policy becomes more pronounced at lower quantiles of RED. This study elucidates the role of e-commerce policy in narrowing RED and provides valuable policy insights for achieving coordinated regional economic development in the new era. First published online 16 July 2025