Abstract: Taihu Lake watershed region is one of the most densely populated areas in China and is confronted with numerous environmental problems, especially fresh water eutrophication. It is of crucial importance to improve soil nutrient management practices in order to have a positive effect on nutrient use efficiency, crop yield, and the environment. Nutrient balances of different times were calculated for arable soils in a case area. It was shown that positive balances for nitrogen and phosphorus and a negative balance for potassium had lasted for decades. Results of representative soil sampling between 1982 and 1999 show that decades of fertilization at rates exceeding the amount removed by crops have resulted in widespread accumulation of nitrogen and phosphorus in the area. Until recently the soil potassium level had declined due to the insufficient input. Soil pH of most samples also decline and this may be attributed to the over use of chemical fertilizer. Based on the analysis of the characteristics of nutrient budget and soil nutrient dynamics of the area some nutrient management options were proposed in the paper.