Groundwater is one of the important water resources in northern China's plain areas. Many severe geological hazards have occurred in these areas due to ground subsidence which is caused by over exploitation of groundwater. This paper introduces and analyses the ground subsidence caused by groundwater exploitation and its mechanism in the northern China's plains. A ground subsidence prediction model has been developed based on the consolidation theory. The authors have tested this model in a case study of Fuyang City, Anhui Province, where ground subsidence is a severe environmental problem. In the case study, the model results match very well with those of the actual measurement. Two schemes of groundwater exploitation are assessed. The conclusion from the study could be used in the long-term water and economical management planning. The strategies for the control of ground subsidence are discussed.