The pursuit of high yield had led to the use of very high inputs of nitrogen fertilizers into cultivated land. As a consequence, it caused vast economic loss and various ecological problems such as nitrate leaching and water pollution. Nowadays, the challenge is to mitigate these trends in order to protect the environment. Nitrification inhibitors (NI) which specifically retard the oxidation of NH4+ to NO2- during the nitrification process can solve these problems in a certain extent. The addition of nitrification inhibitor (NI) with fertilizers can reduce the nitrogen loss and improve the nitrogen efficiency. DMPP (3,4-dimethylpyrazole-phosphate), a newly developed NI, had been used to enhance the nitrogen supply for cultivated crops and to reduce nitrogen losses from the production system. Based on its own characters and advantages, this paper focused on the paddy system, summed up the research advances on DMPP, and systematically overviewed it from mechanism of nitrification and denitrification, microbial impact, application effects and some other aspects. Besides, it explored the issues and controversies in the existing limitations of the researches, and carried out the prospects for the future researches. According to the summaries, the study affirmed the special effect of DMPP in reducing nitrogen loss, improving nitrogen use efficiency, reducing the agricultural non-point source pollution risk and promoting environmental protection in the paddy fields. For more profound influence, this study provided a scientific basis for the reasonable application of DMPP, reducing environmental pollution and improving the utilization rate of nitrogen fertilizer, promoting the coordinated development of agriculture and environmental protection.