At present, the power transformer and the magnetically controllable reactor (MCR) are manufactured respectively, two devices have their own core respectively. Two devices occupied area is larger. The double function transformer which realizes the transformer and MCR two functions with a MCR core is proposed. The double function transformer occupied area is small. A simulation model based on MATLAB/Simulink is built and the double function transformer is simulated. The results show that no matter how much the change of the transformer core saturation is, the change of the transformer leakage reactance caused by it is not greater than 7%. The proposed double function transformer can realize transformer and MCR two functions at the same time. Transformer module operation has little impact on MCR module work; little impact on the transformer module working caused by MCR module run.