In view of special working characteristics and structure, engineering machineries do not have conventional suspension system typically. Consequently, operators have to endure severe vibrations which are detrimental both to their health and to the productivity of the loader. Based on displacement control, a kind of active damping method is developed for a skid-steer loader. In this paper, the whole hydraulic system for active damping method is modelled which include swash plate dynamics model, proportional valve model, piston accumulator model, pilot-operated check valve model, relief valve model, pump loss model, and cylinder model. A new road excitation model is developed for the skid-steer loader specially. The response of chassis vibration acceleration to road excitation is verified through simulation. The simulation result of passive accumulator damping is compared with measurements and the comparison shows that they are close. Based on this, parallel PID controller and track PID controller with acceleration feedback are brought into the simulation model, and the simulation results are compared with passive accumulator damping. It shows that the active damping methods with PID controllers are better in reducing chassis vibration acceleration and pitch movement. In the end, the test work for active damping method is proposed for the future work. [ABSTRACT FROM AUTHOR]