The importance of new firm formation has long been discussed in the literature of traditional regional science and urban economics. The results of numerical empirical studies show that the new firms create jobs, stimulate technological progress, and contribute to regional economic growth. Therefore, the new firm formation is an important policy issue for each region. Though the empirical studies demonstrate the determinants of spatial variations in new firm formation, almost all literatures neglect the difference of the determinants across industries. We analyze the determinants of regional variation in new firm formation by industry using the 47 prefectural data in Japan. The results of our analysis show the following evidences; 1) gross regional expenditures (GRE) is the factor promoting the new firm formation in all industries, but impact of GRE greater in service sectors than in manufacturing sectors; 2) the average wage is the important factor in manufacturing sectors, while the factor is not significant in service sectors; 3) the industrial agglomeration contributes to stimulate the new firm formation in service sectors.