Abstract: Modern industrial system serves as the material and technological foundation of a modern nation. With the rapid advancement of the new round of technological revolution and industrial transformation, China’s modern industrial system building presents enormous opportunities and remarkable achievements. However, it still faces numerous problems and challenges. Globally, international political conflicts such as the Russia-Ukraine war and Middle Eastern tensions have erupted in multiple regions, while profound changes in the global economic environment, including U.S. trade sanctions against China and Europe's "de-risking" policies, have introduced significant uncertainties to China's modern industrial system building. Domestically, challenges persist, such as low added value and high energy consumption in traditional industries, as well as insufficient core technological capabilities in emerging industries and reliance on foreign supply chain. China remains in a critical phase of overcoming obstacles in its modern industrial system building. The industrial structure transformation is a core variable in understanding the economic development disparities between developing and developed nations, while also represents an essential requirement for latecomer countries to accelerate their economic growth. From the perspective of industrial structure, a modern industrial system is characterized by a higher proportion of industries that are intensive in advanced knowledge and technology, exhibit strong innovation capabilities, and boast high value-added rates. Therefore, this article proposes an analytical framework for industrial structural transformation in modern industrial system building. By comparing the evolution trends of industrial structures in the U.S., Germany, the U.K., Japan, and China, the study examines three dimensions: service-oriented level of industrial structure, technological level of industrial structure and digital economy export level. Among these, the service-oriented level of industrial structure refers to the degree of transformation toward a service-based economy, measured by the formula (Primary industry value-added share of GDP × 1) + (Secondary industry value-added share of GDP × 2) + (Tertiary industry value-added share of GDP × 3); the technological level of industrial structure indicates the proportion of medium- and high-tech industries within manufacturing industry, those with higher technological barriers and added value, measured by the ratio of medium- and high-tech manufacturing revenue to total industrial revenue; the digital economy export level reflects the share of digital economy-related exports in total exports, measured by the proportion of ICT (Information and Communication Technology) manufacturing and service industries exports in total export volume. Given disparities in economic development stages across countries, the analysis defines comparable periods based on per capita income levels, with a focus on structural transformations after reaching high-income status. The study yields three key insights: first, a high-level service industry is a robust driver of national economic growth and a vital indicator of competitive advantage. Balancing the proportions of the three industries and optimizing the relationship between service industry and manufacturing industry are crucial for sustainable development. Second, high-quality manufacturing industry is central to economic stability and industrial competitiveness. Sustained innovation, flexible industrial policies, and robust infrastructure investment are essential for structural upgrading. Third, digital economy development must be prioritized, leveraging the service sector to facilitate the transition from production-oriented to consumption-driven economies, while tailoring structural upgrading pathways to national conditions.