Audit independence is a necessary condition for the government audit to play the function of “immune system” such as prevention, disclosure and resistance. The government audit is an important way to promote the disclosure of local fiscal information and realize the modernization of local governance. In this paper, a Stackelberg game model between audit department and local government is constructed to analyze the impact of audit independence on the fiscal information disclosure behavior of local governments. On this basis, using the “quasi-natural experiment” of the reform of provincial-level unified management of human resources, finance and matters of audit institutions, and panel data of 295 cities from 2013 to 2020, the impact of the improvement of audit independence on the transparency of local finance is analyzed by the difference in difference method using the urban panel data. The results show that audit independence significantly improves the fiscal transparency of local government. For cities with high degree of marketization, low degree of dependence on natural resources and high degree of fiscal autonomy, audit independence has a more significant effect on fiscal transparency. Audit independence used to promote the disclosure of local fiscal information is mainly through the deterrent effect. Further analysis also shows that audit independence has horizontal convergence effect between regions and synergistic effect between audit supervision and social supervision in improving fiscal transparency. This article's study provides the evidence support for our country to carry out audit system reform, provides the new reform points for promoting fiscal information disclosure.