Population aging plays a crucial role in urban green transformation development, and it is of great theoretical and practical significance to clarify the relationship between the two. Based on systematically sorting out the connotation of green transformational development (GTD), this study constructed a framework system for urban GTD, measured the GTD performance of 284 prefecture-level and above cities in China using the EW-TOPSIS model, and further explored the impact effects and mechanisms of population aging on urban GTD in China using the ESDA method, the spatial Durbin model and the mediating effect model. The main findings are as follows. (1) The average urban GTD performance in China from 2009 to 2019 showed a steady upward trend, but was still at a low level. Overall, the spatial distribution pattern of GTD performance showed the characteristics of “south > north” and “east > west”, mainly showing the evolution characteristics of the Yangtze River Delta city cluster, the Pearl River Delta city cluster, and the Beijing-Tianjin-Hebei city cluster as the core high-value areas gradually decreasing outward. (2) The impact of population aging on urban GTD had nonlinear and spillover characteristics, that is, population aging also impacted urban GTD in surrounding areas. Specifically, the increase of population aging in a city had a significant “U” shape effect on the GTD of that city, but the effect on the GTD of neighboring cities had an inverted “U” shape effect. (3) In terms of impact mechanism, population aging positively affected urban GTD by increasing human resources and technological innovation, while the transmission path of reducing labor supply had not yet come into play. Finally, according to the research findings, targeted recommendations are put forward.