With the advancement of industrial Internet industry informatization construction, the protection of industrial production data privacy has become an urgent problem to be solved. Blockchain technology provides new ideas for industrial production security protection due to its unique features of decentralization, immutability, and traceability. Based on a comprehensive analysis of the privacy protection needs of industrial production, this research proposes a data privacy protection method for industrial Internet based on blockchain technology. This method uses asymmetric encryption algorithms to ensure data transmission security, and combines smart contracts to achieve precise control over data access, ensuring that only authorized users can decrypt and use specific industrial production. In addition, a multi-party authentication mechanism has been introduced, involving producers, suppliers, and data validators to enhance the transparency of data sharing. In the experiment, a simulated industrial Internet environment was constructed to test the security and efficiency of the proposed method. The results showed that there were no data leakage incidents under simulated attacks; In terms of data access efficiency, compared to traditional cloud storage solutions, the response time has been improved by about 20%, but it ensures higher data security. Research has confirmed that the industrial Internet production data privacy protection strategy based on blockchain technology combined with smart contracts can effectively resist multiple security threats. At the same time, this strategy can adapt to the application needs of industrial institutions of different sizes, and has extensive promotion value.