Abstract: Sponge city has become one of the hottest topics in many industries and technology fields recently, while the current construction of sponge city in China is facing a lot of controversies with different understanding on the connotation of sponge city, as well as its construction objectives, content and practical results. Considering the water problems in the process of urbanization in China, combined with the authors' research and survey experiences, this article analyzed the concept of sponge city from the perspective of urban hydrology process. Then, a discussion was made on several issues, including construction objectives and indicators of sponge city, function development, underground rainstorm storage system and construction & management institution. Finally, a summary of the related discussions was given. Key points of this paper are that sponge city is a reshape of the urban water system and the urban living environment. Integrated functions will be a presupposition of the success in sponge city construction. Urban water system including rivers and lakes are supposed to be cores in the construction of sponge city and an overall program on the basin and city scale is especially needed. The sponge city construction must base on the advantages from multi-sectoral and cross-sectoral collaborations and need to be designed systematically.