This paper examines the nexus between local government debt and economic growth in China. Particularly, the Authors investigate whether there exists a debt-threshold effect on economic growth and the long-run effect of debt increase on economic growth. They employ a panel threshold autoregressive distributed lag model to take account of several features in real data which are commonly ignored in the literature, such as cross-province heterogeneity, dynamics, cross-sectional dependence that exists across provinces. Using data on a sample of 31 Chinese provinces over the period from 2015 to 2021, the Authors find the existence of a tipping point about 40%. We also find the threshold value for the local government general debt is 60%, while the value for the local government special debt is 10%. Regardless of the threshold, however, in the long run, the local government debt is significantly negatively related to economic growth.