Uneven distribution of rainfall in hilly red soil regions, especially rainstorm was one of the principal factors that cause soil and water losses on upland slope of Udic Ferrosol. Reclamation of the land decreased runoff but increased soil erosion. Decline in soil and water loss is not an intrinsic characteristic of an alley cropping system. It depends on how it is managed. Compared to what was in the sole Choerospondias axillaries system, runoff decreased by 50%~60% and soil erosion was increased by 247%~325% in the peanut system. Compared to what was in the peanut-only system, runoff was decreased by 21% and 6%, and soil erosion by 11% and 23%, respectively, in a 5-year-old and 9-year-old Choerospondias axillaris-peanut alley cropping systems. But there was no significant difference between the peanut-only system and the alley cropping system in terms of soil and water losses per unit area of peanut grown.