The fundamental reason for the externality of river basin environmental governance is market failure. The government led ecological compensation mechanism can effectively internalize the externality, which is one of the methods to solve the environmental problems of river basin. This paper takes the basin system composed of the upstream local government and the downstream local government as the research object, and considers that the central government subsidizes the upstream pollution control cost and the downstream local government subsidizes the environmental protection publicity, so as to study the cooperation between the upstream and downstream local governments in pollution control and environmental protection publicity. Then, based on the differential game theory, three game strategies are constructed. The conclusions are drawn as follows. The subsidy policy of the central government can effectively stimulate the enthusiasm of the upstream and downstream local governments to cooperate in pollution control and public environmental protection publicity. It is necessary to make scientific and reasonable distribution contract to balance the interests of the indemnifiers and the indemnitees. The central government can formulate differentiated subsidy schemes according to different game strategies and income distribution agreements, combined with relevant parameters, so as to better improve the effect of basin environmental governance.