The incidence and mortality rate of lung cancer is the highest in Xuanwei County, Yunnan Province, China. The mechanisms of the high lung incidence remain unclear, necessitating further study. However, the particle size distribution characteristics of HULIS emitted from residential coal combustion (RCC) have not been studied in Xuanwei. In this study, six kinds of residential coal were collected. Size-resolved particles emitted from the coal were sampled by using a burning system, which was simulated according to RCC made in our laboratory. Organic carbon (OC), elemental carbon (EC), water-soluble inorganic ion, water-soluble potentially toxic metals (WSPTMs), water-soluble organic carbon (WSOC), and HULIS-C (referred to as HULIS containing carbon contents) in the different size-segregated particulate matter (PM) samples were determined for health risk assessments by inhalation of PM. In our study, the ratio of HULIS-Cx to WSOCx values in RCC particles were 32.73–63.76% (average 53.85 ± 12.12%) for PM2.0 and 33.91–82.67% (average 57.06 ± 17.32%) for PM2.0~7.0, respectively. The carcinogenic risks of WSPTMs for both children and adults exceeded the acceptable level (1 × 10−6, indicating that we should pay more attention to these WSPTMs). Exploring the HULIS content and particle size distribution of the particulate matter produced by household coal combustion provides a new perspective and evidence for revealing the high incidence of lung cancer in Xuanwei, China.