At present, the model of heterogeneous fluid production in horizontal wells in bottom water reservoirs does not comprehensively consider the influence of parameters such as flow, length, and position of each production section, resulting in the distortion of interpretation results. Using the Green function and the Newman product method, this paper derives heterogeneous fluid production in horizontal wells in the bottom water heavy oil reservoir. The Stehfest numerical inversion algorithm was used to obtain the bottom fluid pressure solution of the horizontal well production in the bottom water heavy oil reservoir with the wellbore storage effect and skin effect. By drawing the typical chart of horizontal well test in sections, the new model can be divided into five typical flow stages: wellbore storage stage, transition stage, radial flow stage, linear flow stage, and late stable flow stage. Based on the interpretation of conventional parameters, such as permeability, well storage, and skin effect, the new model can further diagnose the parameters such as liquid production length, liquid production position, and liquid production volume of each horizontal section. The field application examples verify the validity of the research results and broad application prospects.