In order to solve the technical problems of mining strip extraction coal-pillar and waste disposal, the waste substitution extraction is proposed. By expounding the effect on surface movement while the layout of waste filling roadway is centralized and decentralized with analyzing feasible coal-pillar width of substitution extraction; the layout with two waste filling roadway placed in middle of strip extraction coal-pillar is determined and its width and height are 4.0 m × 5.0 m, respectively; and the coal-pillar width between filling roadway is 4.0 m. Based on numerical simulation to analyze the stability of substitution extraction coal-pillar and vertical stress distribution of main roof in strip and substitution extraction, the conclusions with the strength of substitution extraction coal-pillar achieving design requirement and the strata structure of main roof remaining stable are achieved. By using the mechanics theory to analyze the character of roof moving and deformation after coal mining, the conclusion is gotten that the basic roof will not fail. The surface deformation operates within the allowable deformation of building. The research results have been successfully applied to coal mining.