Taking the laser retro-reflector on GRACE gravity satellite as an example, the main technical parameters, such as the laser incident angle of laser retro-reflector on satellite, velocity aberration compensation, and the relatively effective reflection area, are analyzed theoretically, and the testability and ranging error analyses for a laser retro-reflector on satellite are conducted as well. By using the TROS1000 mobile satellite laser ranging (SLR) system, a ranging experiment on the laser retro-reflector on GRACE satellite with a precision of 0.9 cm is conducted and the experimental result is basically consistent with the theoretical analysis result.