A service fault locating method and apparatus for precisely locating a network fault problem in a multi-layer OAM architecture network. The method includes: receiving a service fault locating request message; determining, an IPS, and an IPD, that a service fault is between a first layer-3 device and a second layer-3 device; obtaining a first network topology between the first layer-3 device and the second layer-3 device; determining a first forwarding path of the service packet between the first layer-3 device and the second layer-3 device according to the first network topology; configuring a forwarding entry of a forwarding device in the first forwarding path, and triggering the first layer-3 device to generate an extended layer-2 OAM packet; and obtaining a first path parameter of the first forwarding path, and determining a specific location of the service fault according to the first path parameter.