Poyang Lake is continuously shrinking and losing its function on account of deforestation and reclamation, causing water quality deterioration, frequent floods and ecological damages that impede economic growth. The research mainly analyzes the cause of Poyang Lake reclamation, its development, and pros and cons through historical literatures. The fact is found from 13th -19th centuries that farmers individually reclaimed the lake had caused external uneconomic problems. It not only negatively impacted local ecology but resulted in economic burden to the local government, who originally considered that the reclamation could bring in tax increases; however, the local financial resources are not sufficient to resolve existing problems. Under the contradictions among economic development, ecological protection, individual benefits and the overall security, the problems will continuously exist. The results of this research give an overall introduction concerning Poyang Lake in China. By illustrating the causes and impacts of reclamation and governances for lake, a relation among a specific political system, economic growth, ecological changes and policies can be demonstrated and underlying factors of flood disaster in China can be summarized.