Abstract: A New Method of three-dimensional terrain model of illumination and dynamic display proposed by the authors, which is the most realistic. The procedure of created different level of detail DEM are given, and processing algorithm and methods appropriate to 3-D terrain model, such as illumination model, hidden surfacese limination, visibility test and shading, are disscussed. Furthermore, dynamic display method of 3-D terrain model appropriate to micro-computer is also discribed in this paper.