The invention discloses a water heater. The water heater comprises a shell, an inner container, a heating device, a water inlet pipe, a water outlet pipe and an ultraviolet sterilization part, wherein the inner container is arranged in the shell; the heating device is arranged in the inner container; one end of the water inlet pipe and one end of the water outlet pipe are arranged at the outer part of the shell; the other end of the water inlet pipe and the other end of the water outlet pipe penetrate through the shell and the inner container and extend into the inner container; the ultraviolet sterilization part comprises a top surface and a bottom surface; the ultraviolet sterilization part divides the inner container into two cavities; the top surface and the bottom surface are in contact with a water body; holes are formed in the ultraviolet sterilization part and are used for allowing the water body to pass through; and ultraviolet light emitted by the ultraviolet sterilization part irradiates into the inner container. The invention further discloses a sterilization method. According to the water heater, the two sides of the ultraviolet sterilization part can emit ultraviolet light, and compared with the method that one side of the inner container independently emits ultraviolet light for sterilization, the sterilization method has the advantages the coverage range of emitted ultraviolet light is relatively large, the irradiation distance of ultraviolet light is shortened, and the sterilization effect is better.