With the rapid development of power Internet of Things, its scale is becoming larger and larger. Many advanced applications depend on the accuracy of network model and state estimation, and the accuracy of network model and state estimation largely depends on network parameter error. Therefore, a parameter identification and estimation method based on mixed-integer quadratic programming (MIQP) and edge computing is proposed. Firstly, a “cloud-tube-edge-end” architecture of power Internet of Things is proposed, and the edge computing layer collects terminal data and conducts data analysis, which greatly reduces the computing pressure of cloud center. In this architecture, the local state estimation is used to limit the branch with error data in a specific range to prevent the measurement errors in other ranges from affecting the local estimation process. Then, the parameter identification model is transformed into MIQP model, and a penalty factor is introduced into the optimization model to identify the parameter error and measurement error in the process of minimizing the objective function. Finally, data encryption, identity authentication, and other methods are used in edge computing to achieve network security protection, so as to avoid network attacks and information leakage in the process of data transmission. The proposed method is tested and analyzed in IEEE 14-bus test system. The results show that the proposed method can accurately determine and identify the error data in a certain probability in the actual operation of the power grid, which is convenient for the controller to find out the wrong data in time and determine the source of the error data, so as to set a reasonable data value.