The invention discloses an FPGA based EFM OAM processing method and a hardware realization device. An EFM OAM (meeting the IEEE 802.3ah standard) aims at a link between two devices connected directly, and has functions including link performance monitoring, fault detecting and alarming and loop test. At present, EFM OAM tends to be realized on the basis of pure software, and performances, especially in the aspects link performance monitoring and far-end fault detection, of OAM are greatly influenced. The FPGA based EFM OAM realizes functions including Discovery of links defined by IEEE 802.3ah, Remote Loopback, Link monitoring and Remote Failure Indication. The FPGA based EFM OAM processing method and the hardware realization device have the advantages that supported EFM OAM functions are comprehensive, FPGA using a Pipeline technology can realize message line rate processing, interface configuration is flexible (optical port and electric port access is supported), and the expansibility is high.