Studying the implementation benefits of low-carbon city pilot policies in fostering green, high-quality development is critical for China’s carbon peaking and neutrality targets. This research examines the effect of urban low-carbon governance on green, high-quality development using a multi-temporal DID model and panel data from 281 prefecture-level cities in China from 2007 to 2020. The findings are as follows: (1) low-carbon city pilot policy can considerably enhance green high-quality development in pilot cities; (2) mechanism tests reveal that fintech and urban innovation moderate the role of power support and wisdom empowerment in the successful promotion of low-carbon cities to achieve green high-quality development in pilot areas; (3) the policy effect becomes more significant as fintech and urban innovation cross the threshold value; (4) heterogeneity analysis shows that low-carbon city pilot policy is more conducive to green high-quality development in eastern regions, financially developed cities, and non-resource-based cities. The conclusions drawn from this paper offer valuable guidance for China’s adoption of appropriate environmental policy designs aimed at attaining high-quality green development.