This paper aims to investigate the impact, mechanism, and heterogeneity of regional integration policy (RIP) on firms’ total factor productivity (TFP). We take the integration of the Shenzhen-Dongguan-Huizhou policy (ISDHP) as the research object and conduct a multi-dimensional fixed-effect DID analysis based on China’s listed A-share firms’ data. The results show that RIP can significantly improve corporate TFP within the region, while it is more pronounced in the SOE group. After a series of robustness tests, the policy effects are summarized as robust. In addition, we use a set of industry chain indicators to identify the mechanism between RIP and corporate TFP from the industry chain perspective. We conclude that the ISDHP can improve corporate TFP by significantly improving the upstream degree of firms’ industrial chain. Further research shows that the impact of ISDHP policies can also improve corporate TFP by green innovating, innovating, and improving market competitiveness. Moreover, the state-owned listed firms have significant advantages in these mechanisms. In general, China’s ISDHP has achieved the expected effect in improving enterprises’ TFP. However, in the future, attention should be paid to the issues of “state tilt” and “private discrimination”.