Based on the rate equations applicable to the erbium-doped fiber laser, a continuous erbium-doped fiber laser of ring cavity has been studied, and analytical expressions on threshold pump power, laser output power and slope efficiency under stationary condition have been derived. Variations of these basic parameters with the length of erbium-doped fiber have been analyzed by the analytic expressions and demonstrated by simulation, which will be help full to the optimization of designing a practical erbium-doped fiber ring laser. The experimental study on erbium-doped fiber laser pumped by 980 nm source has shown that the output characteristics were in good agreement with the theoretical calculations.