Strengthening grid management is an important starting point for promoting the modernization of rural governance. Based on the data of the 2018 China Labor Force Dynamics Survey, this paper empirically analyzes the impact and mechanism of grid management on villagers' participation in public affairs governance. The empirical results show that grid management significantly improves the willingness of villagers to participate in the governance of public affairs, and the conclusion is still valid after a series of robustness tests. Mechanism analysis finds that grid management can alleviate the negative impact of social capital loss caused by labor outflow by strengthening the accumulation of social capital represented by social networks, trust and norms, and then improve the willingness of villagers to participate in public affairs governance. Further discussion shows that the full-time construction of grid staff can improve the implementation effect of grid management. The analysis of village heterogeneity shows that grid management can play a more significant role in promoting villagers' willingness to participate in public affairs governance in villages with small population and social organization.