A service chain fault detection method includes: determining, by a service forwarding entity (SFE), to communicate with a first service function (SF) node on a service chain after obtaining a first fault tracing detection request packet, wherein the first fault tracing detection request packet comprises a path identifier (ID), and the path ID is used to identify a path of the service chain; obtaining, by the SFE, an ID of the first SF node; and sending, by the SFE, a first fault tracing detection response packet to the device for initiating fault detection, wherein the first fault tracing detection response packet comprises the path ID and the ID of the first SF node.