This paper presents a system dynamics based simulation game for environmental policy making. Due to the increasing awareness among people regarding the deterioration of environment as a result of the use of modern technology, the government has to take some action against the industry to motivate them to take pollution control measures. This leads the government and the industry into a game situation wherein they take actions, perhaps every year, by observing the other’s reactions. Subsidy, tax exemption, and pollution taxes are found to be the viable options before the government. This situation is modelled here as a game in three modes, namely, both government and industry interactive mode, government only interactive mode, and industry only interactive mode. The results obtained by these three modes of the game are then compared with the model results. This game facilitates experimentation with different strategies for both the government and industry representatives. It is found improving the knowledge of the participants in decision making in such a conflicting environment.