The invention discloses a height direction adjusting system and method after railway foundation subsidence. The system comprises an embedded base plate, an embedded sleeve, a connecting sleeve and a fixing system, wherein the fixing system comprises a base plate, pressing plates, rail corner base plates, pressing plate fasteners, a rubber base plate, locking gaskets and sleeve bolts. When the foundation of a steel rail subsides, the system is used to hoist the subsided rail and the fixing system for adjusting, base plate heightening or foundation heightening are used to perform height direction adjusting according to the subsidence amount differences, the procedure for demounting the fixing system is omitted, and time and labor are saved. After the railway foundation heightening system is completed, the stability and reliability of a railway can be guaranteed during long-term use. By the railway foundation heightening system, the problems that the heightening of an existing railway is complex in construction after large-scale railway foundation subsidence and the heightening material is not standard are solved, and a large amount of manpower and material resources are saved for clients.