The invention provides a monitoring system based on a network element. The monitoring system comprises a service source side database, the network element, a network monitoring server, an operation terminal and a monitoring database. The invention provides a monitoring method based on network elements. The monitoring method comprises the steps that service flow to be monitored is obtained and processed, a network monitoring server accesses local databases of all the network elements, and information is collected, analyzed and monitored. Whole network monitoring data are collected and comprehensively analyzed through the network center server, the transmission path and the transmission process of a service message in the whole network range can be analyzed afterwards, the fault position ofmessage packet loss or error codes is automatically positioned, and the precision is high; real-time tracking of the service message can also be started, and an alarm is given out in real time when the message is lost; and various statistical data can be provided.