The invention relates to the field of mine geology, and discloses a water detection and release method for coal seam mining in a yellow mud grouting goaf. The method includes drilling holes in the tunnel formed by the coal seam to be mined into the goaf, and observing the distance L between the water surface in the goaf and the top of the yellow mud through the drilled holes, and the thickness D of the yellow mud; directly releasing water through the drilled holes which do not expose the yellow mud, and sealing the holes on the drilled holes which do not expose the yellow mud after the water release is completed; and electric traction and drainage are adopted for the drilling position of the exposed yellow mud; draining water at the drilled holes exposing the yellow mud through electric traction; after the water release of the drilled holes exposing the yellow mud is completed, reinforcing the drilled holes exposing the yellow mud; performing water intercepting holes in the same horizontal direction of the goaf, and an objective layer of the water intercepting holes is a water-isolating layer; monitoring the water bursting points in the coal seam mining process, reinforcing the water bursting points between the goaf and the coal seam after the water bursting points are found, and then pushing the water bursting points to enable the water bursting points to enter the compactionarea. The method has the characteristics of being simple and easy in implementation, is free of sludge burst risk and having the capability of effectively reducing the water bursting risk.