To meet the requirement of high precision power control of semiconductor laser used in fiber communication, the principles of semiconductor laser and photodiode were studied throughly with regard to the internal structure and power characteristics of semiconductor laser. According to the performances of LD and PD in practice, the method of power control with high precision was proposed. The power control circuit of semiconductor laser using logarithmic amplifier AD8304 with wide range baseband log compression was designed. And the closed loop control circuit was analyzed in detail according to the internal structure and principle of converter AD8304. The testing result demonstrates that the module of power control can keep the laser working stably, has advantages of wide range of operation temperature, high control precision, less cost and easy integration, and can be applied in most semiconductor lasers.