A limited adaptive genetic algorithm (LAGA) is proposed in the paper for inner-plant economical operation of a hydropower station. In the LAGA, limited solution strategy, with the feasible solution generation method for generating an initial population and the limited perturbation mutation operator, is presented to avoid hydro units operating in cavitation–vibration regions. The adaptive probabilities of crossover and mutation are introduced to improve the convergence speed of the genetic algorithm (GA). Furthermore, the performance of the limited solution strategy and the adaptive parameter controlling improvement are checked against the historical methods, and the results of simulating inner-plant economical operation of the Three Gorges hydropower station demonstrate the effectiveness of the proposed approach. First, the limited solution strategy can support the safety operations of hydro units by avoiding cavitation–vibration region operations, and it achieves a better solution, because the non-negative fitness function is achieved. Second, the adaptive parameter method is shown to have better performance than other methods, because it realizes the twin goals of maintaining diversity in the population and advancing the convergence speed of GA. Thus, the LAGA is feasible and effective in optimizing inner-plant economical operation of hydropower stations.