Based on system dynamics model, the water resources carrying capacity of Chongming Island in Shanghai city was discussed. Six scenes of water diversion (local surface water quantity, present water diversion quantity, 10% largest water diversion quantity, 20% largest water diversion quantity, 30% largest water diversion quantity and 50% largest water diversion quantity) as well as four scenes of water resource policies (present water policy, water conservation and recycling policy, industrial structure adjustment policy and integrate policy) were analyzed. The water resources carrying capacity of Chongming Island in different years was simulated, and the population, GDP and COD at different scenes were predicated. Compared with longterm plan of Chongming Island, the water resources carrying capacity indicators were calculated. Finally, the strategy which can promote coordinated development of society, economy and environment was obtained.