Abstract: Plastic film mulching has been widely used as an agricultural technology in arid and semiarid regions of northwest China. It is beneficial to soil and micro-environment. Furthermore, it prompts crop growth and water use efficiency. However, continuous plastic mulching may accelerate the decay of soil organic matter, decrease soil microbial diversity, increase soil water repellency and thus destroy the soil ecological environment. Biochar can improve soil physicochemical properties and crop yield and quality, which has been demonstrated by many studies. But its effect varies greatly with soil properties, crop types and biochar characteristics. With biochar’s large specific surface area and strong adsorption capacity, this study attempted to add biochar into soils with plastic film mulching to solve the problem of soil fertility decline and yield reduction caused by plastic film mulching. A field experiment was conducted to explore the interaction of film mulching and biochar application on yield and water use efficiency of potato in the Eastern Agricultural Area of Qinghai-Tibetan Plateau. In 2019, four treatments was designed: biochar application (B), film mulching (M), biochar application and film mulching (M+B) and control (CK). The results showed that plant dry matter accumulation mainly occurred in the tuber bulking and starch accumulation stages. Plant dry matter was improved significantly at early stages by film mulching whereas at late growth stages by the biochar application. Plant dry matters at harvest were increased significantly by both biochar and film mulching, and dry matter under film mulching treatment was 1.4 times as much as that under biochar treatment. Biochar increased root biomass significantly while film mulching had no significant effect on root biomass. Moreover, root to shoot ratio affected by biochar was significantly higher than that by film mulching. Potato consumed most water at the seedling stages, followed by tuber bulking stage, and the water consumption prior to the tuber bulking stage was over 3 mm/d. Water consumption, water consumption proportion, and water consumption intensity at both seedling and maturity stages were all the lowest under biochar treatment. Total water consumption and soil water consumption were significantly improved by film mulching, which was 35 mm higher than the CK, while total water consumption in biochar treatment had no significant difference with control. Both biochar application and film mulching increased water use efficiency (WUE). The WUE values in the B, M and M+B treatments were improved by 28.3%, 38.4% and 47.8% compared to CK, respectively. Both biochar application and film mulching increased potato tuber yield, and film mulching increased the number and yield of big tubers significantly. However, both biochar and film mulching had no significant effect on the number and yield of middle and small tubers. The main effect of film mulching on improving potato yield with and without biochar application, was 2.2 times as much as that of biochar application. The net income of potato production was improved significantly by film mulching but decreased by biochar application mainly due to the high prices of biochar. The study showed that the film mulching was still a good way to increase potato yield and water use efficiency in the Eastern Agricultural Area of Qinghai-Tibetan Plateau.