We study an finite-difference time-domain (FDTD) system of uniaxial perfectly matched layer (UPML) method for electromagnetic scattering problems. Particularly we analyze the discrete initial-boundary value problems of the transverse magnetic mode (TM) to Maxwell's equations with Yee's algorithm. An exterior domain in two spacial dimension is truncated by a square with a perfectly matched layer filled by a certain artificial medium. Besides, an artificial boundary condition is imposed on the outer boundary of the UPML. Using energy method, we obtain the stability of this FDTD system on the truncated domain. Numerical experiments are designed to approve the theoretical analysis. Keywords: Maxwell's equations, uniaxial perfectly matched layer, initial-boundary value problem, stability, FDTD MSC(2000): 65M12, 65Z05

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