The present invention discloses an underwater building unit and its installation and application methods. It includes a caisson with both ends open and is composed of two rows of box boards being not intersected with each other. Each row of box boards consists of a set of stake-plate body combinations and the bind members between every two adjacent stake-plate body combinations. A positioning beam is located on the top of the box boards and connects the two box boards. There is a cross rib at the middle part of the outer surface of each bind member. The open caisson is made up of small components of low weight. So it is easy for installation and could be extended unlimitedly as required. In addition, the underwater building unit has low underwater condition requirement and is relatively stable, thus the underwater building is quite firm and has a long life. Each component of the open caisson can be industrially manufactured on land so as to lower the cost and free of the influence of stormy waves.