This article examines the current status of Zhejiang Province’ s laboratory animal industry following the implementation of license separation reform. We find that while the reform has lowered market entry barriers and increased the number of market entities, it has also introduced new challenges to the regulatory system.Both the production and use of laboratory animals have expanded, with quality improvements observed, yet issues of insufficient standardization persist. Although scientific research and innovation capabilities have improved, regional development disparities remain evident. To address these challenges, we propose countermeasures, such as refining the regulatory framework, strengthening industry self-regulation, and enhancing scientific research and innovation capabilities, to foster the healthy development of Zhejiang Province’s laboratory animal industry.