According to the satellite remote sensing monthly mean sea surface temperature data from 1998 to 2002, it is shown that, the Sulu Sea is dominated by a cold eddy both in summer and winter. A coupled single-layer/two-layer model is employed here to study the summery and wintry characteristics and dynamic mechanism of the upper circulation in the Sulu Sea. According to the numerical experiments, it is found that, due to the local monsoon stress cud, the upper circulation in the Sulu Sea is dominated by a weak anticyclonic eddy in summer and a strong cyclonic eddy in winter. Once there is a large outflow via the Sibutu Passage flowing out of the Sulu Sea in summer, the upper circulation in the Sulu Sea may be dominated by a cyclonic eddy instead of the normal anti- cyclonic one. Moreover, in summer, the water exchange between the Sulu Sea and South China Sea via the Mindoro and Balabac Straits might have some effect on the separation position and strength of the northward western boundary current next to the Indo - China Peninsula in the southern South China Sea.