Based on one-center model, the effects of the doping amount and the degrees of reduction and oxidation on the dynamic range M, the response time and the photorefractive sensitivity in the crystal LiNbO3:Fe are analyzed in detail. The principle of material optimization is discussed. The best crystal thickness (about 1.4～2.6 mm) for the maximum dynamic range M is calculated for the different doping amounts. The results show that the more the doping amount, the lighter the reduction of the crystal should be chosen, and that the heavier the reduction of the crystal, the less effect the doping amount has on the response time. The dynamic range M is in conflict with the response time. Due to the difficulty of processing crystals, the thickness is increased to 5 mm at the cost of decreasing the dynamic range M by 0.3～0.5.