Abstract: The entity correlation stability problem in supply chain coordination is studied. By analyzing the mechanism, rules of supply chain coordination, and entity relation in a supply chain, a dynamic nonlinear model is developed to describe the operations of a supply chain. Then, based on the model and Lyapunov exponent stability criteria, the supply chain stability analysis is performed. By simulation, the stability threshold of key parameters can be obtained. The proposed method and results obtained are helpful in operating a supply chain.