A bidirectional isolated communication circuit and method for a differential signal. The circuit comprises a first detection circuit used for receiving a first differential pair from a first direction, converting the first differential pair into a first level signal, and inhibiting common-mode interference; a second detection circuit used for receiving a second differential pair from a second direction, converting the second differential pair into a second level signal, and inhibiting common-mode interference; an isolation adjustment circuit used for being provided between the first detection circuit and the second detection circuit and performing communication isolation; and a watchdog circuit used for being awoken according to the first differential pair and/or the second differential pair, and enabling the bidirectional isolated communication circuit to enter from a small current working mode to a normal working mode to perform communication isolation.