It is established that the propagation equation of the optical field including PMD and the numerical simulation model in the microwave photonic switching based on NOLM by the split-step Fourier method(SSFM) that can solve the coupled nonlinear Schr?dinger equation(CNLSE),the three dimensional Poincare sphere theory and the Jones matrix method. It is obtained by simulation that the propagation process of optical carrier directly intensity modulated by the microwave in NOLM and the impact of the first-order and second-order PMD on the optical wave and the power transmission function of NOLM. The switching performance and the extinction ratio of the NOLM with large modulation bandwidth are deteriorated badly by PMD. And it induces the descent of the SNR and the side lobe leak of the signal. The impact of the second-order PMD is far more than that of the first-order PMD when the modulation bandwidth is larger than 40GHz. Furthermore,the compensation of PMD in the NOLM is discussed.