Abstract: This paper analyzes the characteristics of the civil aviation transport industry with the concepts of scale effects, scope effects and network effects, discusses the dynamical features of natural monopoly and competition in the industry according to the demand growth as well as the market development, points out the inevitability of reform about the civil aviation transport industry management by the government and the active effects resulted from the deregulation, and also puts forward some advice for Chinese government (CAAC) on the reform of the industry in the future.