The invention discloses a digital predistortion power amplifier and signal processing method thereof. The digital predistortion power amplifier comprises a digital predistortion unit, a digital predistortion adaptive controller, a first digital-to-analogue conversion unit, an up-conversion unit, a power divider, a first wavelength delay unit, a peak value amplifier, a second wavelength delay unit,a coupler, a carrier amplifier, a first down-conversion unit, a first analogue-to-digital conversion unit, an envelope extracting unit and a first signal processing unit; wherein one end of the envelope extracting unit is connected with the base band signal receiving terminal, and the other end is connected with the grid terminal of the peak value amplifier by the first signal processing unit. The invention extracts the envelope signal of the input base band signal by the envelope extracting unit, the first signal processing unit processes the envelope signal to be operational grid voltage value of the peak value amplifier, further the grid voltage value of the peak value amplifier can be set according to the variation of the envelope signal, so as to cause the peak value amplifier to beoperate in high-efficiency state.