Abstract: The failure characteristics of composite mortar are revealed based on the test results of a levee project. The critical stress state of tensile and shear for the impervious composite mortar is presented, as well as the failure criterion of diaphragm wall. The tensile strength is used in the tensile failure criterion of diaphragm wall. The shear level is used in the shear failure criterion of diaphragm wall. The ratio of flexible span is used as the auxiliary failure criterion. According to the failure criterion and mechanical analysis, the diaphragm wall would display a good behavior, which has been verified in the levee project.