The construction and development of China’s forest cities revolves around the goal of building an environmentally friendly society and achieving harmonious development between human beings and nature, which is essentially the implementation of the concept of green development and helps promote the sustainable development of sustainable cities. Based on the panel data of 263 prefecture-level cities in China from 2001 to 2020, the National Forest City Policy (NFCP) is used as a quasi-natural experiment to assess the effect of NFCP on haze pollution management and their heterogeneity using a time-varying DID (difference-in-differences) model, and a mediating effect model is used to analyze the mechanism of the effect of NFCP on haze pollution. The research found that (1) the NFCP can reduce urban haze pollution, and this finding remained robust after placebo tests and the replacement of explanatory variables; (2) the NFCP is more conducive to reducing haze pollution in the Pearl River Delta urban agglomeration, Type II large cities, cities in the eastern region, and cities east of the Hu Huanyong line; (3) the NFCP will improve urban green space coverage, raise residents’ awareness of environmental protection, and promote the development of tertiary industries, thereby promoting urban haze reduction.