H2SO4-modified biochar has been recognized as a means to achieve the advantages of carbon sequestration, and nitrogen loss reduction. However, little information is available on its effect on phosphorus (P) uptake, soil available P, and P leaching under alternate wetting and drying irrigation (IAWD). A split-plot experimental layout was carried out with two irrigation regimes (conventional continuous flooding, ICF, and alternate wetting and drying, IAWD) as main plots and three biochar additions (biochar-free control, B0, non-acidified biochar, B20, and acid-modified biochar, B20A) as subplots. Results indicated that IAWD decreased water percolation by 9.26%–14.74% and P leaching by 50.14%–106.64% and increased surface soil available P by 10.88–29.08%, resulting in 14.21–35.03% apparent phosphorus balance (APB) over the three years as compared with ICF. B20 produced a 6.23% lower grain yield in the 1st year and 5.06% and 11.02% higher yields in the 2nd and 3rd years, while B20A increased or tended to increase it throughout the three years. Both B20 and B20A significantly decreased total water percolation (9.68–28.37%), P leaching (18.26–152.00%), and increased soil available P (9.90–46.24%), dissolved P in surface soil (10.00–62.50%), and P uptake (4.31–49.71%), and thereafter enhanced apparent phosphorus balance (11.06–40.78%). Compared with B20, B20A achieved a better APB due to a 113% lower P leaching and 52.9% lower dissolved P at 60 cm soil profiles. IAWDB20A-M produced the highest APB, surface soil available and dissolved P, and the lowest P leaching, which increased grain yield, APB, surface soil available P, and dissolved P by 9.54%, 129.61%, and 53.19%, and decreased P leaching by 257% over ICFB0, respectively. Therefore, the use of H2SO4-modified biochar could produce higher grain yield with lower P leaching and higher APB for IAWD paddy systems, which is beneficial to enhancing plant P uptake, mitigating P leaching, and ensuring sustainable agricultural production.