Abstract: To finding the effect of science and technology (S&T) awards of national defence on technological innovation, the effect of "technology-person" chain was put forward, the causality between awards and promoting innovation was determined and the model was set up by using the method of system dynamics. The result indicates that the effect of national defence S&T awards on technological innovation involves in the aspects such as: remarking performance, basic technological reserve, guiding innovation strategy, commercialization of innovation, cultivating main body of innovation and talent motivation.