Gas belongs to flammable and explosive hazardous gas. When the leakage of gas occurred in limited indoor space, the serious consequences would be produced. According to the characteristics of the gas leakage diffusion, firstly Gambit was established indoor gas stove nozzle dispersion physical model. Secondly CFD fluid dynamics software FLUENT was used to simulate the diffusion process of continuous leakage. Finally comparing the diffusion results under certain temperature gradient but different moisture conditions, and monitoring the specified installation area with variety of mounting points, the aim was to optimize the installation position of the alarm. The results show that the location of distance and relative humidity of indoor air were both the key factors on affecting the alarm time. For the same mounting points, relative air humidity increasing 15% would cause delaying the time of alarm nearly 6 s| under the same air relative humidity, each time the alarm was away from the leaking mouth increasing by 1metre, alarm time would lag for 4 s.