The hydrological information of the basin was extracted by using the grid DEM in the watershed, and compared with the local dry season TM image to draw conclusion. By using the national standard scale 1:50000 digital topographic map as the data source and contour and altimetric point information in the research, 5 m resolution DEM in the study area was generated in ArcGIS software, and on the basis of DEM, hydrological characteristics, flow direction and network information were extracted by using ArcGIS in hydrological analysis. After comparing the network extraction results in different threshold with TM images the conclusion is drawn that: the degree of anastomosis is the highest when threshold is set to 400000, when the threshold value is higher than 400000, it will lead to more river branches information loss, and part of the main stream has dried up. When the threshold is lower than 400000, there will be a lot of “pseudo river” which does not exist in the reality. The parallel river network and main stream will be missing when using the DEM drainage network extraction. In the algorithm based on DEM extraction river network, it is possible to replace the upstream water with higher water value on the grid, but this will inevitably affect the degree of automation of the model, and the size of the assignment needs to be studied.