The time evolution of entanglement and thermal entanglement of an isotropic XY model on the inhomogeneous chain is investigated when there is anisotropic magnetic field. Since entanglement is a very important resource in the field of quantum information, the study of measure and time evolution of entanglement is necessary. The quantity of concurrence was theoretically calculated and it was analyzed by numerical simulations. If the external magnetic field is small and the nearest neighbor coupling is large, the concurrence oscillates between zero and one. If the external magnetic field is large and the nearest neighbor coupling is small, the maximum concurrence can be reduced and even disappears. Meanwhile, the entanglement decreases when the number of spins in the Heisenberg chain increases. The thermal entanglement drops quickly when the temperature increases. It decreases also as the external magnetic field increases. It increases if the inhomogeneity of the system increases.