Soil and water conservation measures such as vegetation cover and terraces effectively reduce runoff and sediment yield. However, there is little information available on how vegetation cover and terraces affect peak flow under extreme rainstorm conditions. The purpose of this study was to investigate the effect of vegetation cover and terraces on peak flow rate in small catchments under “7.26” extreme rainstorm conditions on the Chinese Loess Plateau. Thirty-two small watersheds located in Chabagou Watershed, Zizhou County, Shaanxi Province, were selected. The watershed areas ranged from 0.03 to 1.55 km2. An aerial image with a resolution of 0.2 m was used to determine the land use and engineering practice by means of visual interpretation. The cross-section at the watershed outlets were investigated. At each cross-section, the flow depth, cross-sectional area of flow, wetted perimeter, and slope gradient of the channel were measured. Then, flow velocity was calculated using Manning’s equation. Peak flow rate was calculated based on flow velocity and cross-sectional area of flow. The results showed that peak flow rates varied from 0.35 to 79.89 m3/s. Unit flood peak ranged from 4.3 to 153.0 m3/(km2·s). Peak flow rate was significantly correlated with watershed area, main channel length of the watershed, mean slope gradient of the watershed, and area percentage of the grassland at p < 0.01. The unit flood peak in the grassland and woodland decreased by 36% and 64%, respectively, compared with that in the watershed with the largest cropland component. Terraces reduced the unit flood peaks in the farmland and grassland by 48% and 39%, respectively. Thus, vegetation cover and terraces effectively reduced peak flow rate, and the susceptibility of the sampled watersheds to flood generation was evaluated as “average’’ under extreme storm conditions. Our findings indicate that vegetation cover and terraces play an important role in soil conservation onsite and flood safety offsite under extreme rainstorm conditions.