Abstract: Based on urban panel data from 2003 to 2013 in China, This paper estimates a spatial Durbin model to examine the relationship between service sector including its sub-sectors and urban technology development. The results are robust to three different spatial weight matrixes and indicate as follows. Firstly, producer service and public service agglomeration can significantly promote local urban technology development, while consumer service agglomeration inhibits technology development. From the view of region, the agglomeration effects of producer service and public service manifest a U-shaped structure. Secondly, producer and public service agglomeration show obvious spatial spillover effects in western regional. On account of positive spillover effects and agglomeration shadows, spatial spillover effect is not obvious in national level, eastern region and central region.