This study aimed at proper characterization of the microstructure and unsaturated properties of undisturbed red soil with white net-like veins from the Chenshan laterite section in Xuancheng City, China. The chemical composition and micromorphology of the white veins and red matrix were studied using a scanning electron microscope, an energy dispersive spectrometer, and digital image processing. Then a series of soil–water characteristic curves (SWCCs) and shear strength experiments were performed on undisturbed net-like red soils using triaxial stress path testing, and empirical expressions commonly adopted for geotechnical engineering applications were used to represent measured SWCCs. A detailed comparison of microstructures in undisturbed soils and on failure planes was undertaken. The results showed that the white veins and red matrix clearly appeared as distinct features at both macro and micro levels. More quartz amassed in the white vein, and more intense depletion of Fe oxide occurred in the red matrix. Measured SWCCs at drying and wetting behaved with hydraulic hysteresis. Change in the axial strain did not match that in the volumetric strain. The stress-strain curve obtained from the unsaturated triaxial shearing test showed the characteristic of strain softening; the peak deviator stress increased with increments of the confining pressure and suction. Pores less than 5 μm2 in size were much more common on the shear failure plane than in the undisturbed soil, whereas pores larger than 50 μm2 were fewer. The major axial angle of soil pores showed a dominant orientation after shearing. In addition, the roundness and fractal dimension of pore outlines on the shear failure plane were greater than those in the undisturbed soil. These results reveal that microstructure and suction play important roles in the unsaturated mechanical behaviors of net-like red soil.