The invention provides an incremental backup system and method. The method includes the steps of establishing a snapshot of VM data to be backed-up, dividing the snapshot into a plurality of small blocks according to preset values to generate a plurality of temporary files, calculating the MD5 value of each temporary file, judging whether the backup is the initial backup or not, sequentially judging whether the MD5 values of all the temporary files are the same as the MD5 values of all temporary files of the VM data which are backed-up before or not, determining the temporary files with different MD5 values, sequentially compressing all the temporary files if the backup is the initial backup, compressing the temporary files with the MD5 values different from the MD5 values obtained through the previous backup if the backup is not the initial backup, backing-up the compressed temporary files, and deleting the copied temporary files. According to the incremental backup system and method, the snapshot is divided into a plurality of small blocks according to the preset values to generate the temporary files, only one or more temporary files which are modified need to be backed-up in the secondary backup process, and therefore time and resources are saved.