As an important photovoltaic (PV) power generation base, the Inner Mongolia Autonomous Region (IMAR), China has seen the problem of blindly constructing PV power stations become more prominent in recent years. It is of great significance to grasp the suitability of regional PV development, power generation potential, and emission reduction benefits for the healthy development of the PV industry. To explore the suitability of PV development in the IMAR and the benefits of emission reduction, this study makes comprehensive use of meteorological, natural geographic, economic, and social data, constructs a comprehensive evaluation index system of PV development suitability in the form of meteorology-terrain-location-vegetation, uses an analytic hierarchy process to determine the weights of the evaluation indexes, and performs a spatially explicit evaluation of the suitability of PV development in the IMAR with the aid of a geographic information system tool to quantitatively assess the potential of PV power generation and emission reduction benefits under different development intensities. The PV power generation potential of the leagues and cities and the demand for electric power are compared. The results are as follows: (1) The suitability of PV development in the western part of the IMAR is greater than that in the central and eastern parts, and the various suitable areas are mainly located in the western Alagxa League and Bayannur City, with particularly suitable areas for PV development accounting for 23.66% of the total area of the IMAR. (2) The IMAR PV power generation potential is enormous, especially for regional development, where 12.57% of it can meet the IMAR 2021 electricity consumption. (3) The distribution of PV power generation potential and electricity demand in the IMAR has strong spatial heterogeneity, and the spatial pattern is characterized by significant features. (4) The energy saving and emission reduction effect of PV power generation in the IMAR is remarkable. Compared with conventional coal-fired thermal power generation, the annual carbon emission reduction is approximately 2.947×10⁹ t if the development of a special suitable area is performed, which is 4.46 times the total carbon emission of the IMAR in 2021 and accounts for 21.20% of China’s total carbon emission in 2021. These results provide scientific references and guiding suggestions for the placement of PV power stations and the healthy development of the PV industry in the IMAR.