The invention relates to a circulating spouting type NOx emission reduction system and a working method thereof. The circulating spouting type NOx emission reduction system comprises a rotary kiln, asmoke chamber, a spouting ring, a fuel system, a tertiary air pipe, a reactor, a first material distribution valve, a first cyclone cylinder, a denitration system, a decomposing furnace, a hopper anda second cyclone cylinder. An air inlet of the smoke chamber is connected with an air outlet of the rotary kiln, an air outlet of the reactor is connected to one side of the decomposing furnace and communicated with the interior of the decomposing furnace, and an air inlet of the reactor is connected with an air outlet of the smoke chamber through the spouting ring. An air outlet of the tertiary air pipe is connected to the bottom of the decomposing furnace, a feeding port of the hopper is connected to the lower portion of the air outlet of the tertiary air pipe, and an air inlet of the secondcyclone is connected with an air outlet of the decomposing furnace; The formation of NOX is effectively avoided or reduced so that the emission reduction efficiency of NOX is improved, and the ammonia water consumption of the denitration system is greatly reduced to save the production cost; meanwhile, the problem of serious material accumulation at the bottom of the decomposing furnace is solved, and secondary pollution can be avoided.