The historical data of precipitation, runoff, annual maximum peak discharge and total flood volume in the study watershed were collected. The observed hydrological data were also collected at the Xitugou experimental station in Duhuang. In addition, an investigation was made on the historical maximum floods in the channels. The hydraulic theories and methods were adopted to statistically analyze the change of the peak discharge and flood volume. Based on the implementation status of Xitugou Watershed Hazard Comprehensive Treatment Project, the available water resource in the regionwas estimated. The study proposed a new model of developing and utilizing the flood resources in the desert. The results show that the implementation of Xitugou Watershed Hazard Comprehensive Treatment Project has led to some utilization models including the flood resources utilization model of river diversion+flood diversion+project protection, the utilization model concerning groundwater runoff due to flood blocking, water resources recycling model regarding cold water rainbow trout cultivation in the desert together with grape growth. Achievements have also been made in containing the desert spreading in the study area, increasing the available water resources in the watershed concerned, and beneficial cycle of regional ecological management and economic development.