System dynamics method has a significant advantage in analysis of dynamic changes and causal mechanism of water resources system with its feedback control theory. First, this paper described the characteristics and development processes of system dynamics approach,then it systematically reviewed the progress in the applications of system dynamics method to water resources system from aspects water quantity, water quality and water ecosystems.The result showed that system dynamics method can well adapted to itself characteristics and evolution trends of water resources system. On the basis of progress review, the paper put forward the development trend of system dynamics method which mainly contain expanding research scale, paying attention to the complexity of water resources system,focusing natural-artificial composite system and coupling various methods to complement each other with their respective superiority.