The invention discloses a method for forming grouting space in a sand gravel layer. The method includes steps of (1) forming a drill hole 3 through a permeable ground layer 7 in a position where a curtain wall is to be formed; (2) placing downwards a steel cage 4 to the position of a pebble layer 6 by means of the above drill hole 3, wherein a longitudinal bar-shaped elongated slot 10 is formed in the steel cage 4; (3) installing a spray head 5 at the bottom end of a drill rod 2, and placing downwards the spray head 5 to the position of the pebble layer, wherein the direction of the spray head is identical to that of the bar-shaped elongated slot 10 formed in the steel cage 4; (4) placing downwards a high pressure air conveying pipe 9 to an outer side of the drill rod 2 until the high pressure air conveying pipe reaches the bottom of the drill layer 3; (5) using the spray head 5 to get through high pressure water flows through the drill rod, and vertically moving the drill rod 2 so that the high pressure water flows cut the pebble layer 6 and muddy sand flows to the bottom of the drill hole; (6) simultaneously using a high pressure conveying pipe 9 to input high pressure air, wherein the high pressure air drives muddy sand slurries to erupt out of the earth surface from the bottom of the drill hole so as to form the presupposed grouting space. According to the method for forming the grouting space in the sand gravel layer, the grouted slurries form the effective underground water plugging continuous curtain in the regulated space.