Abstract: Assuming the formation of a circular arch-shaped principal stresse trajectory when the noncohesive granular backfill behind a retaining wall reaches limit equilibrium, the major and minor principal stress arches occur respectively when the backfill obtains passive and active ultimate failure. A lateral earth pressure coefficient and the rotating angle of principal stresses are deduced after considering the soil arching effect by assuming the presence of a straight failure plane, whose inclined angle towards a horizontal level is determined by the earth pressure function. The analytic formulas for the spatial distribution of passive earth pressure, the value and application height of the resultant force are solved by the differential element method (DEM). Paik’s formulation for active earth pressure which considers soil arching effects is further developed. The calculation examples that are conducted in this study prove the consistence between the theoretical prediction considering soil arching effects and the experimental observations in model tests.