In China, listed companies in China have the behavior of embezzlement for a long time. In the micro level, this seriously damages the interest of creditor and minority shareholders. In the macro level, this also harms the healthy development of the capital market and the national economy. So, it is very important to study the constraint for embezzlement behavior of controlling shareholders. Among many constraints mechanisms, reputation mechanism is considered to be the most perfect governance mechanisms because of its advantage of low cost and big punishment. Through the theoretical study, the game study and empirical study, this research will examine the reputation’s constraints function for embezzlement behavior of controlling shareholders. Theoretically reputation has constraints function for embezzlement behavior of controlling shareholders, and the constraints function is reflected in reputation of controlling and reputation of enterprises. In Chinese listed companies, the accumulated reputation of controlling shareholders has constraints function for embezzlement behavior of controlling shareholders. However, the reputation of enterprises is not well reflected.