Epidemiological studies have focused on the effects of iodine intake on the risk of thyroid cancer. However, their relationship is still obscure. The objective of the present study was to examine the association in the Chinese population. A new ecological study which combined the Data of Annual Report of Cancer, the Survey of Iodine Deficiency Disorders (IDD) surveillance and the Water Iodine Survey was conducted to analyse the relationship between iodine intake and the thyroid cancer incidence in China. In total, 281 counties were included. Thyroid cancer incidence was negatively correlated with the consumption rate of qualified iodised salt (CRQIS) and positively correlated with goiter prevalence (GP) of children aged 8–10 years, residents’ annual income and coastal status. Areas with a low CRQIS and areas with a high GP had a relatively high incidence of thyroid cancer. Regression models showed that a low CRQIS and a high GP in children aged 8–10 years (both reflecting iodine deficiency status) play a substantial role in thyroid cancer incidence in both males and females. Additionally, living in coastal areas and having a high annual income may also increase the risk of thyroid cancer. These findings suggest that mild iodine deficiency may contribute to the exceptionally high incidence of thyroid cancer in some areas in China. Maintaining appropriate iodine nutrition not only helps to eliminate IDD but also may help to reduce the occurrence of thyroid cancer.