This report explores the potential and application of the Debt-for-Development Swaps（DDS）mechanism in promoting green finance innovation and sustainable development. As global green transformation accelerates，developing countries face significant debt pressures and financing needs，particularly in addressing climate change and achieving sustainable development goals. DDS，as an innovative financial tool，can effectively alleviate debt burdens while providing essential funding for green projects. The report focuses on the implementation pathways of the DDS mechanism，assesses its practical cases in different countries and regions，and discusses how to integrate this mechanism with China’s green finance strategy to promote green investment and sustainable development. Through an in-depth study of bilateral，and commercial DDS cases，the report proposes strategies for promoting DDS in China，particularly within the context of the Belt and Road Initiative. Additionally，the report highlights the challenges that may arise in implementing DDS，such as policy coordination，project selection，and financial guarantees，and provides corresponding policy recommendations aimed at offering theoretical and practical guidance for China and other developing countries in utilizing DDS for green transformation.