Underground reservoir water storage technology has become one important way to achieve efficient coal mining and water resource protection in the western mining areas of China, and the width of coal pillar dams is an important factor affecting the safe operation of underground reservoirs. In order to study the limitations on the reasonable size of a coal pillar dam, Daliuta Mine was selected as the engineering background and a theoretical formula for the reasonable width of a coal pillar dam was proposed. By combining theoretical analysis with numerical simulation analysis, the main influencing factors of the coal pillar dam were compared and analyzed. The research results indicated that changes in the mining height and coal parameters can cause a sharp change in the width of the plastic zone of the dam body. Then, mine water will have an impact on the width of the plastic zone and the width of the elastic core. Moreover, when the width of the coal pillar is smaller than the theoretically calculated width of the coal pillar dam body, the deviator stress and vertical stress inside the dam will significantly increase, and the plastic zone of the dam will significantly expand.