Abstract: Based on the Cobb-Douglas production function, this paper calculates the agglomeration level of forestry industry in Yunnan Province from 1997 to 2014 using the method of location quotient and establishes the economic model to study the relationship between forestry industry agglomeration and regional economic growth. The results showed that elasticity forestry industry cluster is 0.167 987, which indicating that the forestry industry agglomeration has a significant positive correlation with regional economic growth, and economic growth would increase by 0.17% per 1% increase in forestry industry agglomeration. In the control variables, the physical capital investment is positive related to the economic growth, with theincreaseof1% in physical capital investment and economic growth of 0.16%, the elasticity coefficient of human capital investment is the highest, which indicating economic growth will increase by 0.55% for per 1% of human capital investment increase. Human capital investment is the main factor of economic growth. Based on the empirical result, put forward relevant policy recommendations to promote the sustainable and healthy development of the forestry industry in Yunnan Province.