In this paper, we analyzed the impacts of industrial localization on the production of food industries using panel data analysis. The objective industries of this study were the “Food industry” as a whole, “Manufacturers of food” and “Manufacturers of beverages, tobacco and feed”, and the area of focus was the Tokyo metropolitan area consisting of 4 prefectures; Saitama, Chiba, Tokyo and Kanagawa. In this study, we measured the industrial localization indices based on Ellison and Glaeser [3] and Mori et al. [13]. Then, we estimated the impacts of industrial localization of food industries on production in the Tokyo metropolitan area by estimating regional production functions. To estimate production function, the D-index was used as an industrial localization index. From the results of this estimation, we found the industrial localization of Japanese food industries has a positive effect on production. JEL classification: R11, R30