Abstract: Water systems are not only important natural details, but also critical data sources for flood preven- tion, disaster reduction and exploitation of natural resources. Water systems are usually extracted from DEM (digital elevation data) with slope-runoff method, the accuracy of which is determined by the pro- cessing method of depressions in DEM. In order to study the effect of different DEM processing methods on the accuracy of extracted water system, we compared water systems extracted from DEM with two pro- cessing methods. In this study, DEM data based on J~d) algorithm and auxiliary data based on AGREE method were tested against 30 meter DEM for Liaohe River valley, Jiangxi Province. The results show that both of the methods are capable of extracting continuous drainage lines of similar orders, quantities and lengths. It revealed that the extracted water systems of two methods agree well in the steep mountain- ous region, but show large differences as for the well-populated flat area. Comparisons also demonstrated that the AGREE method enjoys high extraction accuracy than J&D methods as for the flat area.