Subgrade modulus is a critical parameter when analyzing the segmental lining of shield tunnels. However, prevailing analytical solutions of radial subgrade modulus (kr) are based on predefined ideal deformation modes, either circular or oval, which are not consistent with the actual ground deformation, and the influence of the grout layer is commonly neglected. In view of this, this study presents a solution of kr considering the actual deformation of the ground and the grout layer between linings and surrounding ground. A displacement fitting method is proposed to relate kr to the arbitrary distribution shape of ground deformation. With this method, kr for actual deformation consists of a series of radial subgrade moduli (krm) for single deformation modes described by sine and cosine functions. Theoretical solutions of krm considering the influence of the grout layer for single deformation modes are then derived based on the composed ground which is made up of the ground and the grout layer. The influence of the grout layer on krm is then discussed by a parameter study. Moreover, the applicability of the proposed method is illustrated through a design case, where the calculated internal forces agree well with the data from field measurement. The influence of actual ground deformation and grout layer on kr, internal forces, and displacement of shield tunnel is then discussed. Results show that an accurate prediction of kr requires the consideration of the actual deformation of the lining and the influence of the grout layer.