Deformation of shape memory alloy (SMA) fiber shell was studied and the intelligent pneumatic muscle (IPM) with SMA shell was proposed to improve actuating characteristics. Output force equation of IPM was established through axial and radial static force equilibrium analysis between fiber stress and external force. The equation between temperature and contraction ratio of SMA wire was deduced by analyzing the volume ratio of martensite to austenite during crystalline structure shift between two different phases. This ratio was adopted to analyze the contraction ratio, contraction force and variable stiffness of intelligent pneumatic muscle. SMA deformation and characteristics test simulations were conducted in Matlab and different pneumatic muscles' characteristics were compared. The results show there is hysteresis in SMA deformation and IPM can get greater bias angle and more flexible stiffness variation by adjusting SMA contraction ratio. The greater the SMA contraction ratio is, the bigger the contraction force of IPM is.