This study investigates the displacement-dependent lateral earth pressure of sandy soil in active state. 3D DEM numerical simulations of plane strain unloading test (unloading in the minor principal stress direction) are carried out firstly to acquire the hyperbolic stress–strain relationship of sandy soil. The initial modulus of sandy soil is observed to increase with the increasing of major principal stress, initial lateral earth pressure coefficient and relative density, while the failure ratio is little influenced by these factors. A simplified hyperbolic model calibrated by the DEM results are then developed to calculate the displacement-dependent active lateral earth pressure of sandy soil. It was found that the hyperbolic model can well predict the variation of lateral earth pressure distribution at intermediate active state of T- (Translation) and RB- (Rotate about the base) mode of retaining structure movement. But it can hardly capture the lateral earth pressure distribution on retaining structure under RT- (Rotate about the top) mode due to significant rotation of principal stress direction. According to the theoretical analysis, the required retaining structure displacement leading to the limiting active state is varied along the retaining structure, and it also dependents on the initial stress state as well as the relative density.