Abstract: The shield tunnel will inevitably cause soil disturbances and endanger the safety of nearby structures. Therefore, it is particularly important to accurately predict the deformation caused by the shield tunnel. The small strain model in FLAC^3D is used as a starting point, and the effectiveness and superiority of the small-strain plastic hardening model (PH-SS model) considering the small strain characteristics of soils are verified by the trixial simulation tests. Based on the shield tunnel in Shanghai soft soil areas, the MC model and the PH-SS model are used to study the displacement fields of surrounding soils caused by the shield tunnel. The study indicates that the PH-SS model can distinguish the difference between the loading and unloading moduli reflect the attenuation of the shear modulus of soils with the increasing shear strain, and it is more reasonable for showing the behavior of soft soils. When the stress release coefficient is less than 0.3, it doesn’t show much difference whether the small strain is considered or not in predicting the surface settlement. However, when the stress release coefficient is greater than 0.3, it is necessary to consider the small strain in soft soils. Large release coefficient of the shield tunnel will lead to greater mechanical response of soil stress-related modulus and larger deformation. By comparing the numerical results with the measured data, it can be obtained that the settlement predicated by the PH-SS model is closer to the measured data than that obtained by MC model, and it is more reasonable in predicating the surface deformation of actual shield tunnel by the PH-SS model.