<p>This paper investigates the relationship between climate policy uncertainty and stock price crash risk. Our findings indicate that climate policy uncertainty significantly elevates the risk of stock price crashes. This relationship holds robustly after addressing potential endogeneity concerns and conducting various robustness checks. Through mechanism analysis, we demonstrate that climate policy uncertainty heightens corporate operational risk and systemic risk, thereby increasing the risk of stock price crashes. In our extended analysis, we find the risk of stock price crashes tends to be more pronounced in companies operating in less competitive markets and in those with lower customer concentration. Additionally, increased crash risk due to rising climate policy uncertainty can impair firms’ ability to access funds. This research provides a reasonable explanation for stock price crash risk from the perspective of policy changes, thereby enriching our understanding of the relationship between environmental policies and financial market stability.</p>