<p>Given the imperative of fostering synergistic environmental and economic development, investigating the cost-effectiveness of environmental policies in reducing pollutant and carbon emissions holds significant importance. This research evaluates the marginal abatement costs (MAC) of carbon and pollutants in 30 Chinese provinces from 2000 to 2019. Then, a difference-in-difference (DID) model is used to evaluate the direct effect of the carbon emission trading system (CTES) on MAC, and its dynamic change properties are examined. The indirect effect of CETS on MAC is next examined from the standpoint of abatement space and technological progress, and lastly, the total effect is taken into consideration. The findings indicate that: (i) The measured MAC exhibits variations based on time and location. (ii) The CETS has a synergistic effect, lowering both the marginal abatement costs of pollutants (PMAC) and the marginal abatement costs of carbon (CMAC), especially the former. (iii) The CETS tends to have a steadily diminishing effect on MAC over time. (iv) The CETS not only reduces carbon and pollutant emissions, but indirectly affects MAC through technological progress and abatement space, and the indirect effect had a stronger impact on PMAC compared to CMAC. Based on the study’s findings, policy proposals are put forth to encourage the cost-based synergy of pollution and carbon emissions reduction.</p> Graphical abstract <p></p>