The invention relates to a closed smoke-water heat exchange system for low-temperature smoke and a working method. Thermal power plants in out country use coals as main fuels; and after smoke discharged by boilers of coal-fired units passes through such traditional environmental protecting equipment as denitration, dust removal and desulfurization, the content of pollutants contained in the smoke is still higher, and the environmental harm is still greater. The closed smoke-water heat exchange system for low-temperature smoke comprises a smoke cooler (1), wherein the smoke cooler is respectively connected with a dust remover (2), a circulating water pump (8) and a steam heater (6); the dust remover is connected with an induced draft fan (3) through a pipe; the induced draft fan is connected with a desulfurization tower (4) through a pipeline; the desulfurization tower is connected with a smoke heater (5); the smoke heater is connected with a chimney (9); the steam heater is connected with a condensed water heater (7); and the condensed water heater is connected with the smoke heater. The closed smoke-water heat exchange system for low-temperature smoke is applied to smoke discharge and heat exchange.