The exploration and utilization of marine resources has promoted the rapid development of marine science and technology, and has put forward higher requirements for underwater communication technology. Long distance underwater wireless optical communication (UWOC) requires the selection of light source on the transmitter side. Laser diodes (LDs) have excellent portability and maneuverability, and have been widely used in the UWOC systems. However, their beam quality is not so good and it is difficult to modulate under high power. In recent years, vertical-external-cavity surface-emitting laser (VECSEL) has received much attention due to its high output power and good beam quality. This work is to explore the advantages of using a 490-nm blue VECSEL as a light source in UWOC, and to improve the performance of the UWOC system by the soft-decision pulse-position modulation (PPM). First, the optical power attenuation coefficient of the channel is obtained, and the measured c is about 0.0591 m^–1 in a 96-m-long tap channel. Subsequently, soft-decision and hard-decision are simulated and experimentally verified. Both simulations and measurements show that the bit error rate (BER) can be significantly reduced with soft-decision. Afterwards, we improve the system by using the soft-decision algorithm and investigate the communication performance of 64 PPMs at different bandwidths by adjusting the PPM signal rate. Finally, 50 MHz is chosen as a signal rate in the experiment. Then a UWOC system is demonstrated in this work. The transmitter side consists of a 490-nm VECSEL light source with an acousto-optic modulator (AOM). The pseudo-random binary sequence (PRBS) is loaded into the arbitrary waveform generator (AWG) for digital-to-analog conversion after PPM modulation, and the analog signal is sent to the driver of the AOM for acousto-optic modulation of the incident beam. The laser is focused before entering the AOM and then collimated after having exited to reduce its divergence. The modulated laser beam passes through a distance of 96 m in the tank by using multiple mirrors on both sides of the tank. Then, the beam is focused by a lens to the avalanche photodiode (APD) for photoelectric conversion in the end, and the signal is processed by a mixed signal oscilloscope (MSO) after data acquisition. A soft-decision algorithm is introduced to further optimize the performance of the PPM modulation. When the optical signal passes through a relatively long distance of 96 m, the measured BER is as low as 1.9 × 10^–5. This indicates that the soft-decision PPM-based 490 nm blue VECSEL UWOC system performs very well.