For such difficulties as low mining efficiency and large amount of data that the data mining of residential electricity data has to be faced with, the analysis based on improved K-means algorithm and cloud computing on massive data of power utilization was researched. As the initial cluster center and the value K are difficult to determine in traditional K-means algorithm, an improved K-means algorithm based on density was proposed. Firstly, the product of sample density, the reciprocal of the average distance between the samples in the cluster, and the distance between the clusters were defined as weight product, the initial center was determined successively according to the maximum weight product method and the accuracy of the clustering was improved. Secondly, the parallelization of improved K-means algorithm was realized based on MapReduce model and the efficiency of clustering was improved. Finally, the mining experiment of massive power utilization data was carried out on the basis of 400 households' electricity data. Taking a family as a unit, such features as electricity consumption rate during peak hour, load rate, valley load coefficient and the percentage of power utilization during normal hour were calculated, and the feature vector of data dimension was established to complete the clustering of similar user types, at the same time, the behavioral characteristics of each type of users were analyzed. The experimental results on Hadoop cluster show that the improved K-means algorithm operates stably and efficiently and it can achieve better clustering effect.