Abstract: Based on social identity theory and China Labor-force Dynamics Survey in 2014, this paper tests whether dialect skill could act as a signal of social identification. Empirical results indicates that dialect skill could act as a signal of social identification between local people and migrant labor-forces. Specifically, from the perspective of individuals, dialect skills could significantly increase social recognitions such as mutual helps, trust in neighborhood, frequencies of interaction between local people and migrant labor-forces, and the willing to settle in local areas. However, from the views of groups, dialect skills has significant and negative effects on social recognitions and the willing to settle in local areas. The instrumental and further analysis results confirm the robust of main conclusions. These results not only enrich the theory of social identity, but also have significant implications for the social governance in urbanization.