Fractured carbonate gas reservoirs feature high heterogeneity and difficulty in development, and the invasion of edge and bottom water intensifies the complexity of exploitation of such gas reservoirs. In this study, reservoir cores with a permeability of 0.001 mD, 0.1 mD, and 10 mD were selected by analyzing the fracture characteristics of the Longwangmiao gas reservoir, and water invasion in fractured carbonate gas reservoirs with edge and bottom water was simulated using an experimental system to investigate the effects of different parameters on gas reservoir exploitation. The results show that the larger the water volume ratio, the more serious the water invasion and the lower the recovery factor. But water aquifer did not strongly affect the recovery factor once the water aquifer exceeded a critical value. The higher the gas production rate, the faster the water invasion and the smaller the recovery factor. The recovery factor peaked when the gas production rate was equivalent to the gas supply capacity of the matrix to the fractures. For gas reservoirs with the overall permeability, the higher the matrix permeability, the higher the recovery factor. Although an appropriate fracturing scale was able to enhance the recovery factor when its matrix permeability was low, an excessive fracturing scale would cause water to flow along the fractures at a rapid rate, which further caused a sharp decline in the recovery factor. With the increase of matrix permeability, fractures exerted a decreasing effect on gas reservoirs. These results can provide insights into a better understanding of water invasion and the effects of reservoir properties so as to optimize gas production in fractured carbonate gas reservoirs.