With the high-speed development of Chinese economy,the problem of unbalance development between Chinese urban and rural areas has become more and more serious.Chinese government has taken a series of policies and measures to narrow the urban-rural income gap to realize the harmonious society.And in 2007,State Council approved Chengdu and Chongqing to be National Comprehensive Coordinated Reform Experiment Districts of Urban and Rural Unified Planning.This paper inspects the effect of the policy of balancing urban and rural development on the urban-rural income gap by using difference in differences method.To make the analysis,this paper takes Chongqing municipality as the treatment group and Zhejiang province the control group,and takes income ratio between urban and rural areas as an evaluating indicator,using panel data of county-level units of both districts from 2004 to 2013.By introducing some relative control variables such as financial development,transportation infrastructure construction,industry structure,and urbanization rate to make a complete analysis,the result shows that both of the level of industrialization and urbanization in Chongqing municipality increased obviously with the implement of the policy.When compared with Zhejiang Province,the implement of the policy did evidently narrow the urban-rural income gap of Chongqing municipality.