In this study Yimin lignite coal from Inner Mongolia was taken for investigating the influence of hydrothermal dewatering (HTD) on trace elements (Hg, As, Se) under different conditions. First, the coal samples were treated through HTD process at a temperature range of 200–300 °C, then proximate analysis was performed to check changes in the coal. Meanwhile, inductively coupled plasma-mass spectrometry and atomic fluorescence spectrometry were used to detect the concentrations of trace elements. Furthermore, minerals in samples were analyzed by powder X-ray diffraction (XRD). Sequential chemical extraction procedure (SCEP) was also performed to determine the occurrence modes of trace elements. The results showed that HTD treatment is effective in removing moisture and upgrading coal rank, and the operating temperature should be in good control at a certain range due to the loss of volatile mass. Minerals in this type of coal mainly include quartz and kaolinite, and HTD may have an effect on removing minor minerals muscovite and siderite. HTD can remove all three elements mentioned above. The highest removal rate detected is about 15% for As, 45% for Hg and 43% for Se. The experimental result shows that occurrence mode of Hg and As exist mainly in pyritic fraction while Se mainly in pyritic fraction and organic fraction. During HTD, all fractions of Hg and Se decrease obviously. However, for As, the decreasing amount in carbonate and pyritic fractions is much smaller than that in organic and silica bond fractions. It can be inferred that pyrite in coal may not decompose but only lose the bonds with trace elements. Pyrolysis behavior of coal and the strong solubility of sub-critical water should be responsible for the removal of trace elements.