Significant current velocity near the sea bottom can be induced by internal waves, even for water a few hundred meters in depth. In this study, a nonhydrostatic ocean model was applied to simulate the generation and propagation of internal waves on the continental slope of the northern SCS. Based on the analyses of the vertical profiles of the currents, the propagation of internal waves along the continental slope can be categorized into six modes. The bed shear stress and the bedload transport were calculated to analyze the general characteristics of sediment transport along the continental slope of the northern SCS. Generally, there was no sediment transport on the sea bottom induced by the internal waves when the water depth was deeper than 650 m or shallower than 80 m. The downslope sediment transport dominated the slope at a water depth range of 200~650 m, while the upslope sediment transport dominated the slope at a water depth range of 80~200 m. The predicted directions of the bedload transport are coincident with the field observations of sand wave migration on the continental slope, which further confirms that the main cause of the generation and formation of sand waves on the continental slope of the northern SCS is the strong bottom current induced by the shoaling process of internal waves.