Abstract: The hydrological features, such as flow direction, the cumulative volume of water, river networks were collected form DEM by using hydrology modules of ArcGIS software. The river network fractal dimension was analyzed by using box dimension and Horton theorem and provided basic data terrain information for the Taoyuan County practice and theoretical research. The results were as follows: (1) the generated steams were integrated and preferably accordant with actual steams by using DEM and hydrology tools of ArcGIS to analyze watershed hydrology; (2) The river network fractal dimension extracted from DEM was almost the same as the original one, and it’s a feasible way to extract fractal dimension from DEM; (3) According to the river network fractal dimension, the river system was still in the primary stage of erosion and growth.