With the continuous emergence of climate and ecological events, the importance of research on climate and environmental changes as well as ecological response has become increasingly prominent. While, traditional methods are gradually incapable of meeting the demand of further research. With the rapid development of modern molecular biotechnology, DNA analysis for lake sediments has been gradually introduced into relevant studies, which effectively makes up the deficiencies of traditional methods and provides researchers with a new perspective for understanding climate and environmental change and the response of ecosystem. The well-preserved DNA in lake sediments contains abundant information about the evolution of communities. DNA analysis is not only a powerful tool to reconstruct palaeoclimatology and palaeoecology, but is also helpful to understand the long-term evolution and internal mechanism of the ecosystem, and investigate the impact of climate and environmental change and human activities on the ecosystem. This review discussed the characteristics of DNA preserved in lake sediments, emphatically introduced the applications of DNA analysis in research on climate and environmental change as well as ecosystem response, finally, we summarized and anticipated the current challenges, possible solutions, and potentially development of this technology in future.