Lake Taihu is a center of flood distribution, water resources regulation, storage, and a barometer of the water ecological environment. Its water level affects the system functions of flood control, water supply, water ecology, water environment, shipping etc., which makes the overall dispatching problem of Lake Taihu increasingly prominent. In this paper, Lake Taihu is taken as the main research object. Based on the monitoring data, mathematical statistics and hydrodynamic model calculation were used to analyze the changes of rainfall, discharge of lake water, water ecological environment and their feedback relationship with the water level of Lake Taihu. Considering the objectives of flood control, water supply, water ecology, water environment and its spatial and temporal differences in risk tolerance during different dispatch intervals, the dispatching water level of Lake Taihu was optimized. On this basis, the dispatching function zoning map of Lake Taihu was proposed. The results showed that, under the conditions of design flood and water supply, the water level of Lake Taihu could be pre-reduced in the early stage and appropriately raised in the late stage through the adjustment of dispatching water level and the overall regulation of river basin water projects. It could effectively guarantee the safety of flood control, water supply and shipping in the basin, and effectively improve the ecological environment of rivers and lakes. It would be continuously improved in practice and exploration, so as to lay a stable foundation for the construction of beautiful Lake Taihu.