Abstract: Researched the resource allocation under the underlay mode in cognitive radio system and proposed a subcarrier allocation algorithm based on dynamic power adjustment. The algorithm firstly adjusted the power of cognitive user in subcarrier dynamically according to the licensed user state in such style as: when the licensed user accessed the subcarrier, the power of cognitive user was limited under the interference power limitation, and when the licensed user left, the power of cognitive user was promoted to the maximal transmitted power in the subcarrier. Then the algorithm allocated subcarriers dynamically according to the service flow distributions of licensed users and cognitive users and the different channel gains of cognitive users in different subcarriers. The simulation shows that, in comparison to the current research, the proposed algorithm can achieve obvious gain in throughput performance.