Salinity variation partly causes the inaccuracy of water cut measurement that leads failure to optimize wells production within the capacity constrains of production facilities. In this paper, salinity compensation method is introduced using Gamma-ray absorption technology, as well as Haimo FM2000SC Water Cut meter, which have the built-in Gamma-Ray salinity compensation capability. Test has been conducted on Haimo FM2000SC to determine salinity contents. The compensation is realized by analysis the received radiation count with the different saline water, and obtaining the coefficient value between these two factors. Testing shows that Haimo water cut meter can achieve accuracy of water cut measurement ± 2.0% absolute with 85% confidence factor.