Due to the improvement and perfection of GPS data processing and analytical method, and the appearance of the high sampling rate of GPS receivers, GPS applications on monitoring dynamic deformation of high-rise or towering structures (such as bridge, high tower, skyscraper) becomes more reality, and may turn into a main tool for dynamic monitoring. This paper takes one instance of GPS dynamic monitoring in high-rise buildings to study the method, function and operating process of deformation analysis based on wavelet transform. The results demonstrate that when the vibration frequency is greater than 0.05Hz, namely vibration period is smaller than 20s, the amplitude less than 1mm or much less of structure vibration can be completely determined by GPS dynamic monitoring technology. Wavelet transform can efficiently extract weak but useful signals from original signals disturbed by strong noises, which is superior to those traditional methods.