Aiming at the problem that stray light interferes with imaging in the process of space-based optical observation, a simulation algorithm of space-based optical observation images affected by stray light is proposed. First, by analyzing the imaging principle of the space-based optical observation image, the simulation process of the space-based optical observation image is designed and the calculation method corresponding to each process is provided. Next, the principle of ground-air-light interference imaging is examined, a mathematical model of ground-air-light imaging simulation is established, and the microelement method is used to realize ground-air-light imaging simulation. Finally, the principle of moonlight interference imaging is described, the mathematical model of moonlight imaging simulation is established, and the moonlight imaging simulation is realized using the extended intercept method. The results obtained from the simulation show that the image fidelity is high when the proposed algorithm is used to simulate the image, and the imaging simulation of stray light is more realistically realized. The accuracy and rationality of the proposed algorithm are demonstrated through relevant documents.