China’s largest freshwater lake, Poyang Lake, is characterized by rapid changes in its inundation area and hydrodynamics, so in this study, a hydrodynamic model of Poyang Lake was established to simulate these long-term changes. Inundation information was extracted from Moderate Resolution Imaging Spectroradiometer (MODIS) remote sensing data and used to calibrate the wetting and drying parameter by assessing the accuracy of the simulated inundation area and its boundary. The bottom friction parameter was calibrated using current velocity measurements from Acoustic Doppler Current Profilers (ADCP). The results show the model is capable of predicting the inundation area dynamic through cross-validation with remotely sensed inundation data, and can reproduce the seasonal dynamics of the water level, and water discharge through a comparison with hydrological data. Based on the model results, the characteristics of the current velocities of the lake in the wet season and the dry season of the lake were explored, and the potential effect of the current dynamic on water quality patterns was discussed. The model is a promising basic tool for prediction and management of the water resource and water quality of Poyang Lake.