To observe the clinical effect and the mechanism of Xiaojin capsule on nodular goiter. Methods:Eighty cases of nodular goiter in accordance with diagnostic criteria were randomized into 2 groups. The control group (40 patients) was treated with euthyrox and the treatment group with Xiaojin capsule. The efficacy was observed after 3 months in both of the groups. Results:The total effective rate of treatment group was higher than that of the control group(P<0.05). FT3 and FT4 in the two groups showed no significant difference(P>0.05). sTSH level of the observation was not improved(P>0.05) while sTSH level of control group was significantly reduced than before treatment. The difference has statistical difference(P<0.05). Conclusion:Xiaojin capsule has obvious clinical effect on treating nodular goiter, and it is worth of promotion.