This paper introduced a suitable home and small business with the MCU line telephone exchange with the design, mainly in the design and SCM AT89C2051 DTMF decoding IC MT8870 and decoding circuitry at the core, by controlling the Circuit, telephone exchanges state detection circuit, dual audio decoding circuitry, analog way to achieve electrical and mechanical extraction of data processing, analysis and state control. SCM AT89C2051 is the core of the system, it is a low-voltage, high-performance CMOS 8-bit microcontrollers, tablets containing 2 k bytes can be repeated in the CD-rewritable Flash program memory and 128 bytes of random access memory data (RAM), the device used ATMEL's high-density, nonvolatile memory technology production, compatible with standard MCS-51 instruction, on-chip built-General eight microprocessors and Flash memory cell, two clock. Two-circuit audio decoding system is an important component of the keys used in telephone (fixed telephone, mobile phone), program-controlled switches and wireless communications equipment widely used in integrated circuits MT8870 DTMF receiver, chips and reliable performance. This system can also access and four extensions, so the city can imitate the calls of various basic functions of processing, using AT89C2051 SCM control makes a simple external circuit, for the sound signal through the dual-audio recognition, and then drive control circuit. Connect the internal telephone system can also call each other and each other can not monitor the calls of other extensions. The system useful, reliable, simple, easy to use and cheap, maintenance is less, can be widely used in enterprises, schools, and institutions such as access to a number of telephone extensions.