In this paper, a method of characteristic extraction and recognition on lung sounds is given. Wavelet de-noised method is adopted to reduce noise of collected lung sounds and extract wavelet characteristic coefficients of the de-noised lung sounds by wavelet decomposition. Considering the problem that lung sounds characteristic vectors are of high dimensions after wavelet decomposition and reconstruction, a new method is proposed to transform the characteristic vectors from reconstructed signals into reconstructed signal energy. In addition, we use linear discriminant analysis (LDA) to reduce the dimension of characteristic vectors for comparison in order to obtain a more efficient way for recognition. Finally, we use BP neural network to carry out lung sounds recognition where comparatively high-dimensional characteristic vectors and low-dimensional vectors are set as input and lung sounds categories as output with a recognition accuracy of 82.5% and 92.5%.