In this paper, we set forth the principle of Cosine Backscatter Model. In the model, and a new algorithm that doesn't omit azimuth angle and can extract DEM in mountainous area was introduced. First, the Radar image is divided into several regions by edge information using Lapalce algorithm. In one region, the image gray level changes slowly. Second, in the same region, we could assume that slope changes slowly, azimuth angle and range angle are affected by their neighbor pixels, the image gray level of pixel is changed by its neighbor pixels, azimuth angle and range angle were assessed from a seed. From known point, we get azimuth angle and range angle respectively by derivative; balance the value through iterative computation by ratio data and Cosine Backscatter Model. In neighbor regions, we get seed of gradient angle by average gray level of two regions and give amend index. From this point, we can get other point gradient angle same as the second step. Then we extract DEM in all regions. By applying this model, the DEM of Zhangbei of Hebei province were assessed. Through checking against the topographic map, the DEM error is little.