The demographic transition that accompanies the urbanization transformation has a key impact on land use efficiency. This study applies the PVAR, SDM, and threshold models to investigate the influence of China’s demographic dividend composition on urban land use efficiency, aiming to provide guidance for the strategic management and allocation of demographic resources, thereby optimizing urban land resource utilization. The key findings are as follows: (1) Spatial effects reveal that the scale and structural dividends of the population size dividend significantly inhibit urban land use efficiency, whereas the technological dividend of the population quality dividend initially restrains but ultimately enhances it. The combined impact of quantitative and qualitative demographic dividends on land use efficiency is most pronounced in the west and least in the east. High population provinces see significant land use efficiency benefits, contrasting with medium and low population provinces. (2) Both population size and quality dividends exhibit a single-threshold effect on land use efficiency. In summary, cultivating diverse talents with superior technical skills is essential for fostering the upgrade of new industrialization models, ultimately significantly enhancing land use efficiency.