Transpiration is a major component of vegetation evapotranspiration, and a core in the study of plant water physiological ecology. Its measurement methods attracted extensive attention, among which, thermal dissipation is considered as an optimal method for measuring tree transpiration. Numerous studies showed that thermal dissipation method was relatively accurate in measuring individual tree transpiration and stand-scale water consumption. However, there exist potential errors between the true value and the measurements during measurement process. In this paper, the potential errors of thermal dissipation method in measuring sap flux density and of the temperature difference determination from single tree to stand-scale were reviewed, and the research prospects on the potential errors of thermal dissipation method in China were discussed. The corresponding solutions were also proposed.