The invention provides a joint compensation method of mode dependent loss and polarization dependent loss. The method comprises the following steps: S1, performing constellation modulation on a bit signal; S2, performing mode polarization time encoding on the signal after the constellation modulation; S3, performing light modulation on the signal after the mode polarization time encoding; S4, performing light polarization beam combination on the signal after the light modulation; S5, performing mode coupling on the signal after the light polarization beam combination; S6, decoupling the signal in mode coupling; S7, performing light polarization beam splitting on the decoupled signal; S8, performing coherent demodulation on the signal after the light polarization beam splitting; S9, performing channel equalization on the signal after the coherent demodulation; S10, performing mode polarization time decoding on the signal after the channel equalization; and S11, performing constellation demodulation on the decoded signal. Through the adoption of the method provided by the invention, the mode dependent loss and the polarization dependent loss in the transmission process can be effectively inhibited, and the system performance is improved.