Knowledge of soil-water retention curve (SWRC) is essential in modeling water and air movement in soils. A new method based on air-water two-phase flow inverse solution was proposed to rapidly determine the SWRC from a transient outflow experiment. The experiment was designed to produce coupled air and water flow in soil pores, and the outflow evolution was measured during the transient processes. Air-water two-phase flow simulations combined with grid search parameter estimation algorithm were developed to determine the optimal parameters in the van Genuchten model by minimizing the difference between predicted and measured outflow data. The proposed method was validated against the transient outflow experiment and a multistep outflow test reported in the literature. The results showed that the cumulative outflow predicted from the optimal parameters matched well with the measured data. The good agreements concluded that the proposed method was reliable and feasible to determine the SWRC for unsaturated soils.