Exploring the effect of new-type urbanization (NTU) on urban carbon abatement is of great practical significance for promoting urban green construction and coping with the challenge of global climate change. This study used data from 250 cities in China from 2008 to 2020 and constructed the NTU evaluation indicator system from five dimensions. We used classical panel regression models to examine the effects of NTU on urban CO2 emissions, and further used spatial econometric models of SEM, SAR, and SDM to identify the spatial spillover effects of NTU on urban CO2 emissions. The main results are that China’s NTU and CO2 emissions are generally rising, and NTU has a significantly negative effect on urban CO2 emissions, with an impact coefficient of −0.9339; the conclusions still hold after subsequent robustness tests. Heterogeneity analysis reveals that NTU’s carbon abatement effect is more pronounced in resource-based cities, old industrial areas, and cities with lower urbanization levels and higher innovation levels. Mechanism analysis shows that improving urban technological innovation and optimizing resource allocation are important paths for realizing urban CO2 emission reduction. NTU’s effect on urban CO2 emissions has a noticeable spatial spillover. Our findings provide policy makers with solid support for driving high-quality urban development and dual-carbon targets.