Taken the data from listed companies of manufacturing industry in China during 2004～2006 as a sample, the relation between accounting information quality and over-investment was studied empirically. It is found that accounting information quality is negatively corrected with firm over-investment and high quality accounting information can prevent over-investment. Further, accounting information quality is more closely associated with over-investment for firms with more free cash flow, which implicates that improving quality of accounting information could prevent over-investment of these firms.