Abstract. With the city expanding, increasing population, function facilities of the Old town can not meet the current economic development and improving living standard requirements of people. The transformation of the old city aims to make urban functions more perfect, more suitable for needs of the people's life, so that the city's image can been promoted. Therefore, urban renewal has become an inevitable product of urbanization. But now there are many problems existed in the process of urbanization. Therefore, how to conduct scientific and rational renovation and modernization of the old city becomes a major issue and social problem in the urbanization. Based on the reconstruction of Shengli District in Yantai, this article discussed the necessity and significance of its renewal and the problems existed in the project, then put forward some countermeasures, such as Selecting Sun Demolition modes -Demolition people-oriented; Opening source throttling to ensure the funds need in the old town environment improvement; Inheriting humanistic spirit, and develop on the basis of protecting the historical and cultural heritage and so on.