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In this article we study the initial-value problem for the periodic two-component b-family system, including a special case, when b = 2, which is referred to as the two-component Dullin-Gottwald-Holm (DGH) system. We first show that the two-component b-family system can be derived from the theory of shallow-water waves moving over a linear shear flow. Then we establish several results of blow-up solutions corresponding to only wave breaking with certain initial profiles for the periodic two-component DGH system. Moreover, we determine the exact blow-up rate and lower bound of the lifespan for the system. Finally, we give a sufficient condition for the existence of the strong global solution to the periodic two-component DGH system.