Due to the special geographical position and the fragile ecological environment, it is necessary to attach great importance to the analysis of the sustainable development in the sea island city. Based on the system dynamic theory and method, a system dynamic model of sustainable development of Pingtan Island is constructed. The model consists of four subsystems: economic, social, resources, environmental. Several plans are formulated for simulation prediction and research. Simulation result shows that the sustainable development ability of Pingtan can be improved gradually in the aspects of the conditions of transportation, health care and education; implementing the project of water diversion from outside the island; controlling the population size, improving the environmental quality of the island, and increasing the investment index of environmental protection. According to the results, some control measures are proposed, which can be used as the scientific basis for the environmental policy making oriented by sustainable development.