Objective: To explore the application effect of Problem-Based Learning (PBL) teaching method based on situational simulation videos in undergraduate teaching of internal medicine, and to provide practical basis for optimizing the undergraduate teaching mode of internal medicine and improving teaching quality. Methods: A total of 32 undergraduate students majoring in clinical medicine (Grade 2021) from Shanghai University of Medicine & Health Sciences were selected as the research subjects. They were divided into an experimental group and a control group by random number table method, with 16 students in each group. The control group adopted the traditional PBL teaching method, while the experimental group used the PBL teaching method based on situational simulation videos. After the teaching, the mastery of theoretical knowledge of students in the two groups was evaluated by examinations; a questionnaire survey was conducted to assess students’ self-perceived improvement in clinical thinking, learning interest, self-directed learning ability and teamwork ability; statistical methods were used to analyze the data. Results: The scores of theoretical knowledge examination of students in the experimental group were significantly higher than those in the control group, and the difference was statistically significant (p < 0.05). In terms of self-evaluation, the experimental group showed better performance than the control group in the cultivation of clinical thinking, learning interest and self-directed learning ability, with statistically significant differences (p < 0.05); however, there was no statistically significant difference in the self-evaluation of teamwork ability between the two groups (p > 0.05). Conclusion: The PBL teaching method based on situational simulation videos can effectively improve students’ level of theoretical knowledge, enhance their clinical thinking, learning interest and self-directed learning ability in undergraduate teaching of internal medicine, and is worthy of further promotion and application in undergraduate teaching of internal medicine.