Abstract: In the urban power grid with high proportion load and serious shortage of power source, the supply failure and load loss risk is very high. The demand side management (DSM) can guide consumers to adjust the way of electricity consumption by means of electricity price, so as to achieve peak-shaving and valley-filling. The load is closely related to the system risk. This paper studies the impact of DSM on urban power grid risk from the consumer side, and establishes the demand side integrated management model from two aspects of energy efficiency load optimization and interruptible load dispatching. Based on this, the risk assessment model and index system is established. The system component's state is sampled by the Monte Carlo method and the risk evaluation index is calculated. The case study is carried out with an actual urban power grid. The risk index considering DSM is compared with those with the traditional method. The results show that the proposed model can effectively reduce the load loss risk of the urban power grid and significantly improve the security level of urban power grid operation.