A method for simulating setting of a projector by augmented reality (AR) includes: activating an AR application on a terminal device; performing, through an image capturing element of the terminal device, dimension measurement on a space where a projector is to be disposed to obtain a space dimension; selecting a placement reference point of the projector and a display reference point of a projection picture; generating, according to the space dimension, the placement reference point, and the display reference point, a simulation picture on the terminal device when the projector projects the projection picture in the space; adjusting the projection picture and/or the projector in the simulation picture to generate an adjusted simulation picture; and comparing the adjusted simulation picture with projector parameter data of projector models to recommend at least one projector model to a user for selection or inputting, by the user, a custom projector model.