Experimental system for laser-induced acoustic signals was built. Acoustic signal was induced by pulsed laser focusing into water. A hydrophone was used to convert acoustic signals into electric signals. The mathematic model for laser-induced acoustic signals in time domain was analyzed. Energy distribution of laser-induced acoustic signals in frequency domain was studied. The modulation method for communication based on laser-induced acoustic signal was theoretically studied and proved by experiments. The results are as follows: Pulse width of laser-induced acoustic signal is about 20 μs. The laser-induced acoustic signals have most of their energy concentrated within 200 kHz, where half of that is between 100 kHz and 200 kHz. Magnitude modulation and frequency modulation are effective methods in communication based on laser-induced acoustic signal.