In western China (Shanxi, Shaanxi, Inner Mongolia, Ningxia and Gansu), there are rich coal resources, while there are also water resource shortage. A surface evaporation capacity is above six times of rainfall. The large-scale, intensive, modern coal mining can result in the formation of crack, destroy the original underground water system, and the generation of lots of mine water. In order to ensure the underground production safety, mine water is traditionally discharged to the surface. However, due to large evaporation capacity in the western area, the discharged mine water can quickly be evaporated and is therefore lost after being discharged. Therefore, a technical approach of storage and utilization of mine water using underground reservoirs of coal mine was proposed, which included design, construction and operation technology. The technical system is composed of water resource prediction, reservoir site selection, reservoir capacity design, dam construction, safety guarantees, water quality control, etc. Currently, 32 coal mine underground reservoirs has been established in Shendong Mining Area, which can provide 95 percent of total water consumption, and been in operation safely with a low cost. It is shown that the underground coal mine reservoir is a safe, economical and scaled water storage technology, using natural underground space and natural rock purification, which could be of great significance in the protection and utilization of underground water resources for coal mining in the western mining area of China. ©, 2015, China Coal Society. All right reserved.