The structure and operating principle of rolling movable teeth reducer are introduced in this paper. Through the virtual prototype technology, the modeling of rolling movable teeth reducer is made by Pro/E software,and is had the kinematics simulation and dynamic analysis by ADAMS software. The simulation results show that the speed curves of the input shaft and the output shaft of rolling movable teeth reducer coincide with the theory transmission. It proves correctness of virtual prototype. The mechanical properties of rolling movable teeth reducer is obtained by the time-domain graph of meshing force. It provides the basis for the optimization design and engineering analysis of reducer.