Abstract: A new mathematical method,wavelet analysis which is called mathematical microscope,is introduced.Then the state of application and research of wavelet transform is introduced in the hydrology system,including four aspects: (1) time-frequency multiple time scales analysis of hydrological time series,(2) change properties of hydrological time series,(3) forecasting in hydrology,and (4) simulating of hydrological process.Finally,some trend and directions for future studies in hydrology and water resources are presented.