For numerical simulation, the shear strength reduction technique (SSRT) is often used to evaluate slope or landslide stability. According to numerical computation results of slopes or landslides analyzed by SSRT, it can be found that with increase of the shear strength reduction factor, some of the soil elements will yield gradually to form a connected plastic zone, which is the potential slip surface of the slope or landslide. In view of the plastic resistance of soils, formation of the connected plastic zone does not always indicate that the landslide is about to failure. Other auxiliary criterion is necessary to predict whether a slope or landslide is in a critical state or not. Here, difference of the incremental percent of horizontal displacement of the outcropping slip surface node is regarded as the auxiliary indicator to distinguish the critical state of slopes or landslides after formation of the potential slip surface. With the ideas mentioned above, stability of a fossil landslide, Xietan landslide has been analyzed for the natural and the long-term reservoir water level conditions. Factors of safety of Xietan landslide by the numerical method have been compared with that by the limit equilibrium method, which indicates that the method used here for evaluating stability of Xietan landslide is feasible. Because numerical method has more advantages over the limit equilibrium method, the approach for evaluating stability of landslide here can be applied to more complicated or three-dimensional landslides or slopes further.