From 1990s onwards, Fujita, Krugman and Venables et al.use conceptual tools of imperfect competition, increasing returns and pecuniary externality to construct theoretical models of new economic geography on the basis of Dixit-Stiglitz framework of monopolistic competition, which leads to a revolution of new economic geography. In terms of theoretical roots and research method, new economic geography exhibits noticeable difference from traditional economic geography. Its theoretical innovation attracts attention from academic circles of both economics and geography. However, new economic geography has been under severe criticism even since its emergence. While some criticism makes academic sense, unfortunately, owing to a lack of full understanding of the theoretical rationale of new economic geography, other criticism actually misses the point. This paper aims to making a comparative study of new economic geography and traditional economic geography in terms of theoretical assumptions, research methods and their respective features. It is hoped that the discussion here will contribute to a clear understanding of the differences as well as similarities between new economic geography and traditional economic geography, which may forward the further research in and application of new economic geography as well as communication between circles of new economic geography and traditional economic geography.