Abstract: In this paper, numerical simulation of nonlinear propagation of gravity wave packets with Gaussian distribution in isothermal and compressible atmosphere is presented by using 2-dimentional FICE scheme. The numerical analysis show that though there exists nonlinear reaction, during the propagation process, the phases of waves move downward, the wave packets and the wave-associated energy propagate upward. Wave-associated disturb velocities increase exponentially with the height and the reaction between the waves and the background leads to the enhancement of the mean flow. These agree well with the linear gravity wave theory. The propagation trace of gravity wave packets is consistent with the prediction of linear ray theory, but the average horizontal group velocity and vertical group velocity are obviously smaller than the results given from the linear ray theory. It indicates that the nonlinear process of gravity waves can change the propagation velocities of wave- associated energy. The simulation results show quantitatively that the effect of nonlinearity on propagation of gravity wave packets for the first time, it indicates that the definitions of dynamics of gravity waves given by the linear theory are reasonable.