<p>Rising economic uncertainty and declining investment efficiency are two critical economic challenges confronting China in the 21st century. This study investigates the relationship between corporate investment inefficiency and economic uncertainty by utilizing a novel quarterly panel dataset of 4229 publicly listed Chinese firms from 2009 to 2022. Employing a high-dimensional fixed effects estimator, the analysis offers robust evidence that rising economic uncertainty exacerbates corporate investment inefficiency, with the effect operating through both overinvestment and underinvestment channels. The heterogeneity analysis reveals that the positive relationship between investment inefficiency and economic uncertainty is more pronounced among state-owned enterprises (SOEs). The time-varying analysis further suggests that economic uncertainty leads to significant short-term fluctuations in corporate investment inefficiency, which persist for up to two to three years. These results highlight the need for macroeconomic stabilization policies and corporate governance reforms to help firms maintain investment efficiency during periods of heightened economic uncertainty.</p>