When the tunnel and underground engineering construction encounters water-rich soft and broken surrounding rock, it is very easy to occur serious disasters such as mud inrush, water inrush and collapse, threatening the safety of engineering construction. Taking the water-rich ultracataclasite stratum exposed by the 4th construction branch of Xianglushan Tunnel in the Central Yunnan Water Diversion Project as an example, this stratum has strong compactness, weak permeability, softening in water and other unfavorable geological characteristics. During the excavation process, several major mud and water inrush geological disasters have occurred. In this paper, the basic physical and mechanical properties of water-rich ultracataclasite rock are tested based on field engineering examples, and the grouting diffusion law under this stratum condition is studied based on PFC^2D numerical calculation software. The research results show that according to the basic physical and mechanical parameters such as density, water content, permeability coefficient, particle size distribution, specific gravity, porosity, cohesion and internal friction angle obtained from the laboratory test of ultracataclasite rock, the analysis shows that the shear strength of the water-rich ultracataclasite stratum is low, further leading to mud outburst and collapse disasters. Under the comprehensive consideration of the number of split grout veins, the distribution of diffusion range and the risk of damage to the existing support, the optimal grouting pressure is determined.