There has been great difference between the theoretical signals of the lidar's echo and its actual signals, due to the angles between the laser beam and its receiving optical axis, and the laser intensity distribution being asymmetrical. So the correction of the echo signal is necessary. According to the mathematical derivation and the software simulation, the mathematical expression of the lidar's overlap factor is given, and the overlap factor curves with detection range are drawn which express the characters over the total detection range, then the best angle between lidar's emitting axis and the receiving axis is obtained. The overlap factors are analyzed when the laser is Gaussian with a uniform intensity distribution. The lidar distance correction signal and Klett formula are corrected by the overlap factor, and the instrument parameters of the lidor are measured. In the range where the overlap factor is not zero, its correction echo signals and extinction coefficients can be obtained by using the corrected Klett formula. While in the range of the lidar's blind zone, the signals can be derived by a slope method. Finally, the total correction curve of the extinction coefficients is gained, and it is in accordance with the actual one correction cuive.