A compatible relationship between "man" and "land" is the essence of regional sustainable development. In this article VENSIM PLE is used to set up a system dynamics (SD) model of the regional man-land system of Xiangfan, Hubei Province, China. The model is used to simulate dynamic behaviors of society and economy in the face of environmental catastrophe, in order to explore dynamic response among subsystems in man-land systems, and to research mechanisms of regional sustainable development. The model is also used to forecast impacts from the south-to-north water transfer project in China on the environment, society, and economy within a time span of 50 years. The model is further used to verify the effects of suggested regulatory policies. The simulation results show counterintuitive outcomes. The most serious impact on Xiangfan caused by the water transfer project would be on economic growth, not on environment quality. However, if a series of regulatory policies were carried out in advance of the water project's construction, the trends of concern could be effectively eased. SD provides tools for precisely understanding complex man-land systems, which always seem counterintuitive. However, there still exist limitations and disadvantages in the model that must be overcome. It is believed that the next logical step in deriving better dynamic models of man-land systems is to integrate SD with other advanced algorithms or technologies.