To study the dynamic characteristics of hydrogen generation reactor, the reaction conversion rate of alloy and water was calculated by chemical reaction dynamic and kinematic analysis of reaction drip, and the mass variation of each substance in reactor was described by the law of mass conservation based on whose molar value was got by the minimum Gibbs free energy method. Based on the law of conservation of energy and a nonlinear moving-boundary model of helical tube, the dynamic process model of this reactor was established. The dynamic process simulation of an underwater hydrogen generation reactor was realized by using the calculation program based on the dynamic model. Results show that the simulation curves can reflect the variation law of parameters during the dynamic process, which proves the validation of the modeling and simulation. The reaction conversion rate determines the variation law of mass and the characteristics of releasing energy in reactor. The established model can be used as the basic foundation for performance analysis and control study of underwater hydrogen generation reactor.