<p>The rise of green products has been accompanied by widespread counterfeiting, which adversely affects low-carbon environmental protection. The retailer may produce non-green products and sell them to consumers disguised as green products to increase profits, as non-green products typically incur lower production costs. To investigate this issue, we develop dynamic game models under both wholesale price and revenue-sharing contracts to examine how different supply chain contract types influence the retailer’s decision regarding the proportion of counterfeit products. We further analyze the impact of regulatory penalties and suppliers’ anti-counterfeiting strategies on retailer behavior. Interestingly, our analysis reveals that higher regulatory penalty costs and increased greenness of the supplier’s product can, in some cases, increase the retailer’s incentive to counterfeit. In contrast, an improvement in consumers’ ability to detect counterfeits consistently poses a deterrent to counterfeiting behavior. Additionally, we find that the effectiveness of each contract in reducing counterfeiting primarily depends on the magnitude of the penalty imposed by regulators. Finally, our results show that when the product’s greenness is higher, the proportion of counterfeit products in the market is the main factor affecting consumer surplus, while when the product’s greenness is lower, price is the main factor affecting consumer surplus.</p>