The invention discloses a system and method for treating domestic sewage in a rural area, which belongs to the technical field of environment-friendly sewage treatment. The domestic sewage enters an aerated grit chamber also serving as an adjusting tank for carrying out appropriate grit setting and adjusting, so that a part of inorganic pollutants is removed; the sewage is conveyed to a concentration type two-stage anaerobic reaction tank through a lifting water pump, suspended matters in the sewage are filtered and intercepted when the sewage passes through a concentration filter layer; contaminated gases, such as CH4, H2S and the like generated in the concentration type two-stage anaerobic reaction tank are discharged through a gas port; a part of concentration liquid is discharged out of the system through a concentration bottom sediment drainage pipe by opening a valve regularly; supernatant fluid from a water outlet of the concentration type two-stage anaerobic reaction tank enters a ladder plunge type wetland, a non-medium wetland, an economic income type wetland, a bacteria filter and a fishpond in turn; and nitrogen and phosphorus eutrophic pollutants in water are filtered, intercepted, adsorbed, decomposed, absorbed and precipitated by rootstocks of aquatic plants and the like. Therefore, according to the novel technology disclosed by the invention, the purpose of water purification can be achieved through regular harvest.