This study focuses on the role of natural amenity in spurring the permanent settlement of elderly migrants in China, in the period from 2009 to 2017. Based on a combination of NASA’s Global Annual PM2.5 Grid data, and a nationwide China Migrants Dynamic Survey (CMDS) dataset, a binary logit model was used to investigate the settlement intention of migrants over 60 years old, across 291 cities in China. The empirical results revealed that there was a significant inverted U-shape between the annual temperature and permanent settlement, and prefectures with warmer winters and higher air quality were more attractive to elderly migrants when controlling for the urban endowment and economic conditions. In addition, the coefficient of the interaction term of air quality and precipitation was negative, indicating that the hindrance of precipitation on permanent settlement intention decreased with the enhancement in better air quality. Furthermore, there was significant group heterogeneity in the elderly’s migration reasons. The group of active movers cared more about environmental quality, whereas for the passive group, air quality had no effect on their permanent settlement.