[Objective] Formula deduction and empirical study of market-based forest value method in water-holding capacity, to improve the accuracy and rationality on value accounting of forest water conservation.[Methods] Adopted market-based value method. It deducted the basic price formula of forest water reservoir by basic principles of Marxism economics, of which labor theory of value and production price theory were focused, and follow the market-based forest value theory and its method. The correctness, feasibility and rationality of deduction formula were exemplified by forest impounding water price in Jilin Province.[Results] Forest impounding water price was 1.00 yuan/m³ in 2008 and 1.28 yuan/m³ in 2013.[Conclusion] More realistic than previous research. It also made the evaluation method of forest water conservation value more scientific.