The complex interactions between shrub traits, soil structure, and soil water dynamics are not well understood yet. This study investigated rainfall partition by C. microphylla L., spatial soil water pattern, soil hydraulic conductivity, and soil macropores to ascertain preferential water flow to deep soil layer by shrub. Results indicated that high variability in throughfall existed within individual shrub stand: average coefficient of variation was 0.36 ± 0.13 for shrub and 0.15 ± 0.13 for interspace grass. Throughfall was less at the center of the shrub patch (30–60% of rainfall) than the outward positions at the edges of the canopy (70–90% of rainfall). Soil water responded differently to rainfall, soil depth, and vegetation type and showed high variability within shrub patches and on the slope. Greater and deeper infiltration was observed beneath C. microphylla L. canopy than interspaces grass after rainfall with large amount and high intensity, suggesting that macropore flow dominated in shrub patches. X-ray CT showed that macroporosity was over six times greater in soil under C. microphylla L. than interspace grass. Soil hydraulic conductivity for shrub at saturation and the pressure heads of −30, −60, and −150 mm were 3, 2, 2.5, and 2 times than those of grass, respectively. Shrub patches had a significant lower bulk density and higher porosity than grass patches at the top 0- to 30-cm depth. Soil hydraulic conductivity was significantly correlated to organic matter content, total N, bulk density, and porosity. This study suggests that rainfall partition by shrub’s canopy and subsurface soil macropores induced by root architecture results in preferential water flow into deep soil layer, which might favor competitive advantages for water by shrubs under arid conditions.