Permeability evolution and damage behavior under shearing conditions are critical for reliable predictions of rock seepage characteristics during excavation and a correct assessment of their impacts on the occurrence of natural or induced hazards. However, publications concerned with this problem have been poorly issued so far. The primary objective of this study is to innovatively investigate permeability evolution and damage behaviors of sandstone in the complete process of direct shear. Several groups of red sandstone specimens are deformed in direct shearing using a newly modified servo-controlled direct shear apparatus to measure permeability evolution and monitor acoustic emission (AE) activities with damage under various normal stress conditions. The morphology of the rupture surfaces is scanned using a 3D laser scanner after tests. According to our experimental results, the locus of the shear stress-displacement curve is found to be closely associated with microcrack progressivity. The initial permeability in advance of shearing test and the peak permeability appearing after the peak shear stress decrease with the increasing normal stress. The minimal and maximum permeability values exhibit a lag-effect with respect to the turning and the peak points on the shear stress-displacement curve. Furthermore, a palpable surge is found in the interevent time function during shearing, which can be a potential indicator for early warning of catastrophic rupture of brittle rock materials under shearing or compression. The joint roughness coefficient (JRC) values in the direction of shearing deformation for each normal stress case are more significant than those in the direction perpendicular to the shear displacement. The impacts of our obtained results are potential ramifications for permeability control in rock engineering projects.