To reveal the gas-liquid two-phase flow characteristics in water supply pipeline due to the rugged terrain, flow pattern, pressure, velocity, turbulent kinetic energy and turbulent energy dissipation rate of 6 key sections and 4 profiles were simulated and analysed on the conditions of with and without exhaust valve. The results showed that water cannot flow smoothly without exhaust valves at sections 1-1, 2-2 and 3-3, while that flows smoothly at sections 4-4, 5-5 and 6-6. For sections 1-1, 2-2 and 3-3, water can only cover less than 50% of the pipeline cross section when the exhaust valves were not set, and various backflow zones can be observed in these sections, which can increase the resistance of the water flow. The turbulent kinetic energy of the cross sections 1-1, 2-2 and 3-3 were 0.87, 1.02 and 0.09 m2/s2, which can decrease to 0.0018, 0.0017 and 0.0017 m2/s2, respectively, after the exhaust valves were set. Meanwhile, the pressure in different cross sections reduced by 1 to 10 kPa and the streamline were nearly uniform and straight for the main flow in the pipe with the exhaust valves. The reverse vortex disappeared and the velocity distribution of the main flow was more uniform in these sections.