This paper investigates the dynamic characteristic, dynamic model and parameter extraction of photovoltaic (PV) cells. Firstly, the isolated capacitance method is presented to test the output impedance frequency characteristics of PV cells under illumination, and then the small-signal frequency characteristics under illumination are analyzed. Then, the dynamic model of PV modules and the small-signal impedance model are built. Based on testing data of PV modules, a model parameter extraction method combining impedance frequency characteristics, PV mathematical analytical model and nonlinear fitting iterative algorithm is presented. This extraction method firstly extracts those fixed parameters with low coupling, and then extracts the parameters with strong coupling and changing with the environment, which greatly reduces the difficulty of parameter extraction. At last, correctness and effectiveness of the proposed extraction method for model parameters are verified by comparing the simulation and experimental results.