Caragana microphylla Lam., a pioneer leguminous shrub species for vegetation re-establishment, is widely distributed in the semi-fixed and fixed sandy lands of the Horqin region. Some soil chemical and physical properties were measured under the canopy of C. microphylla and in the adjacent open areas to determine the effects of individual shrubs on soil properties. The influence of isolated C. microphylla on chemical and physical properties of the topsoil was significantly different between plots under the shrub canopy and in the shrub interspaces. Beneath the shrub canopy greater amounts of fine particle fractions, a higher water-holding capacity, and a lower bulk density, as well as higher aboveground and belowground litter biomass were found. Soil organic C and total N concentrations were 23%-31.6% and 14%-27.2% higher under the shrub canopies than in the shrub interspaces, respectively, giving rise to “islands of fertility”. In a desertified sandy grassland ecosystem, C. microphylla was believed to play a major role in organic C sequestration, N accumulation, and the hydrologic cycle. Additionally, it has been found to be of ecological importance for vegetative restoration and reversal of desertification. Some soil chemical and physical properties were measured under the canopy of C. microphylla and in the adjacent open areas to determine the effects of individual shrubs on soil properties. The influence of isolated C. microphylla on chemical and physical properties of the topsoil was significantly different between plots under the shrub canopy and in the shrub interspaces. Beneath the shrub canopy greater amounts of fine particle fractions, a higher water holding capacity, and a lower bulk density, as well as higher aboveground and below litter biomass were found. Soil organic C and total N concentrations were 23% -31.6% and 14% -27.2% higher under the shrub canopies than in the shrub interspaces, respectively, giving rise to “islands of fertility”. In a desertified sandy grassland ecosystem, C. microphy lla was believed to play a major role in organic sequestration, N accumulation, and the hydrologic cycle. Additionally, it has been found to be of ecological importance for vegetative restoration and reversal of desertification.