A packing method for a defective sheet based on branch-and-cut algorithm, including: acquiring sheet information, where the sheet information includes size information of the defect sheet, size information of a target block and position information of a defect; based on actual cutting requirements, establishing constraints; and establishing a primal problem model according to the constraints; converting the primal problem model into a relaxed problem model; checking and verifying the obtained solution by x-check method to determine whether the obtained solution meets the constraints of the primal problem model; outputting the optimal solution to obtain an optimal cutting plan that meets the actual cutting requirements; and cutting the defective sheet according to the optimal cutting plan. A system for implement the packing method is also provided.