Abstract: As an important means of relieving ecological crisis, environmental regulation has penetrated into every field of environmental governance. Studies have shown that “the diseconomy of environmental externalities” is an important cause of environmental regulation failure, while the paradox of environmental regulation is the result of regulation “softening” that is locally effective and out of control in scope due to the lack of strategic game and incentive structure reorganization, rather than the whole regulation failure. Strategic game is characterized by government-enterprise alliance and central-local “principal-agent” relationship, leading to target displacement and process dissimilation. Binding incentives are characterized by incentive hindrance and incentive mismatch between central government, local government and enterprise, especially more attention to the “hard indicators” of promotion by local government. In order to reverse the “softening” situation of regulation, the “boosting” environmental regulation should be adopted, gradually shifting from command-control to hybrid regulation tools, from binding incentives to compatibility incentives, from strategic games to dynamic equilibrium games, and from “softening” of environmental regulation to institutional innovation.