Abstract: Beginning from the laws of the industrial structure evolution that Classical economics gave,this article analyzes the causes by the division of labor-transaction costs, technological innovation and their interaction,and draws the conclusions on the basis:The industrial structure evolution is essentially the result of the deepening of division of labor, while it' s itself a result of technological innovation,and further promotes the latter. Therefore,the process of industrial structure evolution also reflects that of the interaction between division of labor and technological innovation,which promotes industrial structure evolution from junior to senior.