Abstract: In conventional loess cutting slope design, the direct shear test fails to replicate the stress boundary conditions of excavation-induced unloading, leading to discrepancies in shear strength parameters and subsequent stability analysis. Based on practical engineering projects, this study employs finite element simulation and plane strain unloading tests to investigate deformation behavior and strength evolution of intact loess during stress relief. Results reveal that soil deformation manifests primarily through axial compression and lateral expansion, with principal stress state transitions significantly influencing deformation patterns. The observed strength enhancement mechanism stems from the synergistic interaction between intermediate principal stress effects and over-consolidation characteristics: sustained lateral confinement maintains elevated intermediate principal stress levels, while the unloading path preserves soil over-consolidation, effectively mitigating strength degradation. Dynamic rotation of principal stress axes during testing enhances shear resistance through relative increases in intermediate principal stress. Finite element models incorporating plane strain test parameters yield safety factors consistent with field monitoring data, unlike those using conventional direct shear parameters. The findings demonstrate that plane strain unloading testing effectively simulates excavation stress paths, providing reliable strength parameters for slope stability assessments, thereby proposing an improved experimental methodology for engineering design applications.