Vehicle emissions are an important source of urban air pollution. As the world’s largest market for new energy vehicles (NEVs), China has rapidly expanded NEV adoption to support green development. However, the environmental and health benefits of this transition remain unclear. Here, using high-resolution satellite-retrieved data and interpretable machine learning techniques, this study quantified the impact of NEVs on atmospheric pollution, specifically particulate matter particles with an aerodynamic diameter of 2.5 μm or less (PM2.5), nitrogen dioxide, carbon monoxide and particles with an aerodynamic diameter of 10 μm or less, and evaluates the corresponding health benefits. By 2023, NEVs led to reductions of 23.80% in particles with a diameter of 2.5 μm or less (8.97 µg m−3) and 30.67% in carbon monoxide (0.26 mg m−3), resulting in the prevention of approximately 262,000 non-accidental deaths and 75,000 all-cause deaths, respectively. Benefits were concentrated in economically developed cities, and reductions in coarse particles and nitrogen dioxide (1.81 µg m−3) were low. These findings highlight pollutant-specific disparities and socio-economic inequalities in NEV-related benefits, suggesting a need to accelerate heavy-duty diesel vehicle electrification and enhance NEV deployment in less-developed regions. Using satellite data and interpretable machine learning, the widespread adoption of new energy vehicles was shown to reduce particulate matter particles with a diameter of 2.5 μm or less and carbon monoxide in Chinese cities, preventing 262,000 non-accidental deaths and 75,000 all-cause deaths.