Abstract: The theory and technology of water-saving through crop compensation for water deficit and how they relate to crop production are theoretically important and potentially promising in agriculture application. Molecular and physiological mechanisms, however, still constitute those issues that need further research. The molecular and physiological processes of water-saving of crop by compensation for moderate water deficit was systematically analyzed based on related research advances in recent years. The researches results showed that water deficit and re-watering could change growth of plant nutritional organs such as roots, stems and leaves. Osmo-regulation, transpiration, photosynthesis and other physiological processes were also altered by water deficit and re-watering. Protein activity and molecular metabolism of crops adapted to changes in water availability. A water deficit threshold controlled compensations in crop production. With appropriate degree and duration of water deficit, crop water use efficiency improved and even increased (instead of decreasing) crop yield. If widely adopted in agricultural production, water-saving technologies through compensation for water deficit could be vital for improving economic returns and food safety.