In this thesis, we build up a new theoretical model for the collinear holographic storage system based on VOHIL model. Besides, we obtain a formula under the paraxial condition to describe diffraction behavior of the system. According to our simulation, we can figure out the detailed diffraction properties of the system, including large shift selectivity and the effect on the diffraction pattern by the reference pattern. In addition, the diffraction characteristics are studied with several important parameters, including the spatial symmetry of the reference pattern, the thickness of the recording medium, the position-dependence of the signal and phase modulation. Finally, we analyze the performance of the storage system by calculating the bit error rate and signal-to-noise ratio.