A magneto-optical modulation method for optical polarization measurement is proposed based on rectangular wave signal. By means of computer simulation, Lissajou figure of the rectangular wave magneto-optical modulation method was investigated, and the principle and precision of this method were studied. The study indicates that, the Lissajou figure of the rectangular wave magneto-optical modulation method is made up of seceral discrete points. By observing whether the discrete points are superposed each other, it can be judged whether the analyzer is at extinction position, and then polarizaiton analysis can be made. In additon, if monitor whether the output signal wave is direct current with electronic instrument, automatical polarizaiton analysis can be performed. Compared with the frequency doubling method based on sine wave magneto-optical modulation, the rectangular wave magneto-optical modulation method possesses higher precision, and automatical measurement is easier to carry out.