Abstract: An elasto plastic shear strength reduction FEM is used to analyze the stability of excavation slope. A well defined failure shear strain zone is formed in the excavation slope. It is found that elastic modules, Poisson′s ratio, dilation angle and lateral pressure coefficient, compared with cohesion and friction angle, have little effect on safety factor of slope. As failure pattern of excavation slope is similar with that of natural slope, it is concluded that the method is appropriate for stability analysis of excavation slope. It is believed that the shear strength reduction FE method can be widely applied in the engineering practice because this method benefits over limit equilibrium method.