The present disclosure relates to a signal processing system applied to remove OTDR noise, comprising: an analog-to-digital converter, a laser and driving unit, a sequence accumulator, a preprocessing counter, a pulse generator, a dual-port memory, a self-adaptive filter, an event decision device, and a preprocessing data decision device. The self-adaptive filter reads preprocessing data from a read-only port of the dual-port memory, and performs noise processing on the read preprocessing data by using a self-adaptive filtering method of wavelet transform. The event decision device performs an event decision on the filtered data output from the self-adaptive filter; The preprocessing data decision device decides whether a certain set of preprocessing data in m groups of preprocessing data is correct data or high-signal-to-noise data according to the difference of the m groups of preprocessing data after passing through the event decision device.