Abstract: This paper describes the structure, principle and design implementation of Intranetbased IP phone system.Adopting the high speed communications media-LAN and three-tier database application technologies and making optimizations against the current Ethernet features, the system has implemented real time audio/file communications within the LAN and the voice frequency dialing(VFD) and audio communications between the LAN and PSTN. The system improves the communication quality by use of several communication technologies, which are ITU-T G.723.1 Audio Codec, Double Buffer for eliminated jitter, ITU-T G.168 echo canelled and available band with detecting. The IP phone system comprises IP phone workstation system, IP phone gateway system, and aid function system. The workstation system also called IP phone terminal system, completes the first-level application, that is, to implement speech dialing and communications in the LAN. The IP phone gateway system is an interactive bridge between LAN and PSTN, through which the user can freely use IP phone workstation system to dial or answer the terminal equipment of PSTN network. The aid function system adopts the hierarchical database access technologies to conveniently access the LAN database sources in the IP phone workstation system and IP phone gateway system and implement such functions as speech-text answering machine, message leaving and BBS.