To explore the role and specific application of cultural and creative product design in the innovative development of local economy, aiming to further optimize cultural and creative design, make it more in line with market demand, and better promote local economic development. Using literature research and case analysis methods, this study delves into the economic driving role, cultural inheritance and innovation role, brand building role, industrial upgrading role, employment promotion role, and social and cultural education role of cultural and creative product design. Select several successful local cultural and creative product design examples, and analyze in detail their design ideas, market performance, and social impact. Research has shown that cultural and creative product design plays a significant role in the innovative development of local economy, effectively stimulating local economic vitality, enhancing local cultural identity and influence, and promoting the inheritance and innovation of local culture. In order to better utilize the relevant functions of cultural and creative products, it is necessary to carry out scientific design and promotion, explore and integrate local cultural resources; Strengthen promotion through new media platforms; Strengthen integration with related industries; Pay attention to user experience and needs; Meets modern aesthetic needs.