With the rapid development of small hydropower in China, its sustainability has drawn more and more attention. Using emergy analysis, one of the ecological energetic accounting methods, the overall sustainability of small hydropower system was analyzed in this paper, when choosing Hongyan second-cascade hydropower plant, Anlong County, Guizhou Province, China as the case. With the ability of accounting all forms of energy and materials from both environment and economic society on a common energy basis, emergy analysis has been used to analyze various kinds of systems such as agro-systems, wetlands systems, and urban systems. It has been proved as a powerful tool of the sustainability assessment of ecological economic systems. The related indices and ratios based on emergy flows can characterize the resource use, environmental impacts and overall sustainability of the studied systems, such as emergy yield ratio (EYR), environmental loading ratio (ELR), and emergy sustainability index (ESI). The results showed that the studied small hydropower production system produced 8.79×10¹³J of electricity in 2010 by support of a total emergy of 9.04×10¹⁸ sej, in which river geopotential energy was the largest input, accounting for 48.35% of the total input. As a whole, 77.29% of the total input was from environment, which indicates that the construction and operation of the studied production system depended heavily on the local free environmental resources. And the transformity of electricity in 2010 was 1.03×10⁵ sej/J, with a fraction of 52.01% renewable resources. By contrast, the transformities of electricity produced by large hydraulic projects at domestic and abroad were larger than 1.50×10⁵ sej/J. Indicated by the comparison of EYR, ELR and ESI among the studied system and the large hydraulic projects, the studied system possessed a higher competitiveness, a smaller environmental stress and a better sustainability. However, the value of emergy exchange ratio (EER) was 0.58, implying that the actual price of electricity integrated into the grid in 2010 was unfair for the studied plant. The process of integrating the electricity into the grid lost certain emergy for the plant. Additionally, a significant feature of small hydropower is unstable operation caused by lacking of dam or reservoir, which is different from large hydraulic projects. The operation of small hydropower plant is largely influenced by precipitation and other water diversion activities. Consequently, the generation of the electricity differs from year to year, which results in the fluctuation of related emergy indices. Moreover, it was found out that when the generation is 50% of the designed generation, the transformity of the studied production system is close to that of large dams on Mekong River and the value of ESI declines remarkably from 6.12 to 3.01. It is concluded that the sustainability of small hydropower production system is very sensitive to its generation. And the generation is determined by the amount of exploitable water resources. In order to improve the sustainability of small hydropower in China, it is important to make a good plan of exploiting hydropower resources and ensure stable operation.