Abstract: In order to understand the canal seepage process under the canal bed with sand interlayer, laboratory experiments were carried out to study the canal seepage in a soil tank with homogenous (sandy loam) and layered (with sand interlayer between the sandy loam layers) canal bed, respectively. The infiltration process and the advancement of wetting front were monitored under different canal water level for the two cases. Mathematical model was established accordingly. Using the saturated–unsaturated flow software HYDRUS-2D, the processes were simulated and examined. The results indicate that the soil water movement model based on traditional Richards Equation is able to depict the soil dynamics with sand interlayer, although the enclosed air may retard the advance of wetting front and bring error to the simulation result; the wetting front would become discontinuous if there was sand interlayer in the canal bed; the sand interlayer show some degree of hampering effect on infiltration if the canal water level is low, however with the increase of canal water level, the sand interlayer tend to enhance the canal seepage.