The present invention discloses a method for handling channel failures in an Automatically Switched Optical Network (ASON). When a channel alarm occurs, the head service node decides whether the channel alarm is incurred by a channel failure according to the alarm message or alarm information. If so, the head and end service nodes continue to locate whether the channel failure is inside or outside the network by combining local detection and message notification. If the channel failure is an internal failure, rerouting is activated to locate and remove the channel failure. When this method is used to locate a channel failure, the amount of information exchanged is small. The method may quickly identify the accurate position of a failure inside the network, improve the efficiency in removing failures, and minimize the damages to services, with little harm to equipment functioning and network performance.