Effects of the aerated liquid level above the downcomer on riser superficial liquid velocity, gas flow rates, and gas holdups in individual sections were investigated in an external-loop airlift reactor. The aerated liquid level is an important operating parameter, and the valve connected to the extension tube could adjust it. As the aerated liquid level was increased up to 0.158 m, which was slightly larger than the diameter of the riser, both the liquid circulation velocity and the gas flow rate in the extension tube increased, whereas the riser gas holdup, the downcomer gas holdup, and the gas flow rate in other individual sections except the extension tube decreased. A combination of the gas-liquid separation ability and hydraulic resistance of the head region and the surface aeration could explain the impact of the aerated liquid level on the hydrodynamic characteristics. However, the effect was negligible when the aerated liquid level was higher than 0.158 m.