The proposed grating moving light modulator is based on micro-electromechanical system, the diffraction grating is provided by the deformed part on its surface, movable grating, and the two working states, on and off, are realized by controlling the displacement of movable grating. Detailed theoretical analysis and simulation for the optical properties of grating moving light modulator at working state are carried out, and the effects of duty ratio, length, frame length perpendicular to the grating period direction, grating stake width and period number of the movable grating on the working performance of grating moving light modulator are discussed with emphasis. The result shows that, the modulator is off when the distance between the movable grating and the mirror is half of the wavelength of incident light, and when the above distance is shortened to a quarter of the wavelength, the modulator is on. For the optimal contrast, it requires that, the stake width is half of the grating period and the length of the movable grating is integral times of the grating period. When the latter condition is not fulfilled, a high contrast can be obtained with short frame, narrow stake and large period number.