To observe the effect of onlay in the restoration of posterior dental defect. Methods A total of 50 patients with posterior dental defect admitted to Suzhou Stomatological Hospital from October 2021 to October 2022 were selected as the research objects. They were divided into control group and observation group by random number table method, with 25 patients in each group. The control group was repaired with all-ceramic crowns, and the observation group was repaired with onlays. The excellent and good rate of repair and gingival status were compared between the two groups. Results The excellent and good rate of repair in the observation group was 96.00%, which was higher than 68.00% in the control group (P <0.05). After repair, the plaque index and gingival index in the observation group were lower than those in the control group (P <0.05). Conclusion The effect of onlay restoration in patients with posterior dental defect is better than that of all-ceramic crown restoration, and it can further improve the gingival condition, which is worthy of clinical application.