This paper constructs the index of industrial policy support through text analysis, and performs empirical tests by using Chinese Annual Report of Industrial Enterprise Statistics and OFDI List from Ministry of Commerce, to analyze how industrial policies influencing firm’s OFDI. This paper also discusses regional diversification of firm’s OFDI and the effect of policies with different categories. The research results show that industrial policies promote the firms’ OFDI significantly, and promote the OFDI by firms that have already invested abroad to conduct OFDI again. Further analysis shows that industrial policy improves the regional diversification of firm’s OFDI, compared with other types of industrial policies, the financial and taxation policies have stronger impact on the probability of firms’ OFDI. Mechanism analysis shows that industrial policies exert stronger impact on OFDI of firms with higher productivity, and of firms with non-state ownership; industrial policies enhance firm’s ability of organization and management, thus promoting OFDI.