In this paper, a pseudopotential high density ratio (DR) lattice Boltzmann model was developed by incorporating multi-relaxation-time collision matrix, large DR external force term, surface tension adjustment external force term, and solid–liquid pseudopotential force. It was found that the improved model can precisely capture the two-phase interface at high DR. Besides, the effects of initial Reynolds number, Weber number, solid wall contact angle (CA), ratio of obstacle size to droplet diameter (χ1), and ratio of channel width to droplet diameter (χ2) on the deformation and breakup of a droplet when impacting on a square obstacle were investigated. The results showed that with the Reynolds number increasing, the droplet will fall along the obstacle and then spread along both sides of the obstacle. Furthermore, by increasing Weber number, the breakup of the liquid film will be delayed and the liquid film will be stretched to form an elongated ligament. With decreasing of the wettability of solid particle (CA → 180°), the droplet will surround the obstacle and then detach from the obstacle. When χ1 is greater than 0.5, the droplet will spread along both sides of the obstacle quickly; otherwise, the droplet will be ruptured earlier. Furthermore, when χ2 decreases, the droplet will spread earlier and then fall along the wall more quickly; otherwise, the droplet will expand along both sides of the obstacle. Moreover, increasing the hydrophilicity of the microchannel, the droplet will impact the channel more rapidly and infiltrate the wall along the upstream and downstream simultaneously; on the contrary, the droplet will wet downstream only.