The invention discloses a thermoplastic elastomer pelleting system and application thereof. The thermoplastic elastomer pelleting system comprises an underwater pelleting unit, a pelleting water heat exchanger, a centrifugal dehydrator, a dryer, a dispersing kettle, a water tank, a cooler and a storage tank, wherein the underwater pelleting unit, the centrifugal dehydrator, the dryer and the storage tank are connected in sequence; the pelleting water heat exchanger is connected with the underwater pelleting unit and the centrifugal dehydrator separately; both the centrifugal dehydrator and the dispersing kettle are provided with temperature control layers, and the temperature control layers control temperature through the fed fluid; the temperature control layer of the centrifugal dehydrator, the cooler, the temperature control layer of the dispersing kettle, the water tank and the temperature control layer of the centrifugal dehydrator are sequentially connected through a pipeline to form a loop. The thermoplastic elastomer pelleting system can effectively reduce the probability that a thermoplastic elastomer bond colloidal particles, increases the product yield and improves the production efficiency; therefore, the thermoplastic elastomer pelleting system is suitable for being applied in elastomer polymer pelleting.