Abstract: Taking natural uncultivated grass slope as the control, the effect on runoff interception and sediment reduction by adverse slope terrace and level bench site preparation methods for afforestation was comparatively studied under the natural rainfall condition in the hot dry valley of Yuanmou County by means of runoff plot observation method. The results showed that both types of adverse slope terrace and level bench site preparation played a very good role in the runoff interception, whereas the adverse slope terrace method had better result. Compared to the natural grass slope, the decrement of the runoff output from the adverse slope terrace and the level bench site preparation was 71.42% and 33.68%, the decrement of sediment by these two types of site preparation was respectively 56.02% and 38.57% during the observation period of time. With the passage of time, the effect of runoff interception and sediment reduction of the site preparation was progressively improved, the runoff and sediment output was gradually reduced. Single rainstorm or extraordinary heavy rainstorm played a leading role in reducing the effect of the site preparation.