Backed up by Dayoushan loess tunnel of Xining in Qinghai province, the displacements of vault settlement, peripheral convergence, surface deformation and post-construction settlement caused by tunnel construction are numerically simulated and analyzed. First, 2-D elastic-plastic model is founded to simulate the tunnel excavation process with up and down steps method. Second, considering the rheological characteristics of loess, 2-D visco-elastic-plastic constitutive model is founded to simulate the creep deformation of rock displacement characteristics. Finally, combined with the serious collapsible feature of loess foundation in supported project, the post-construction settlements under different conditions are simulated to obtain the settlement values of tunnel vault and bottom. The results can explain the deformation laws of tunnel displacement characteristics reasonably and show the importance of foundation reinforcement measures for loess tunnel.