In order to explore the internal conflict and synergy among water pollution control, water conservation and socio-economic development, a system of coupling simulation for the aquatic environmental-economic system of lake watershed was constructed and applied at Yilong Lake Watershed. Based on the scenario analysis, the following conclusions are drawn. 1) Under the condition of economic and social affordability, the nutrient load of Yilong Lake can be reduced to the level of aquatic environmental capacity corresponding to Grade IV water quality through the measures of controlling the pollution. 2) The implementation of industrial relocation or very strict scale restriction is extremely unfavorable for gross domestic product (GDP) growth and urbanization of the watershed, but does not play a significant role in protecting the aquatic environment of Yilong Lake. 3) The critical measures in the planning period are to change the planting practices of high water-consuming and heavy fertilizer-using, treat rural domestic sewage more effectively, promote sewage reuse, and reduce the transfer of sewage. 4) According to the simulation results, the optional scheme selected by the approach proposed here would reduce the water diversion demand by 45%, and cut down the total nitrogen (TN) and total phosphorus (TP) discharged into the lake from the land surface by 26.6% and 18.5% respectively, and eliminate the TN and TP load of the lake by 20.7% and 17.5% respectively, but only at a cost of 7% of GDP at the end of the planning period.