<p>Unsaturated seepage is a key factor in triggering geohazards in land constructed with compacted loess on the Loess Plateau. However, in situ monitoring of deep soil–water interactions remains challenging. In this study, a 77&#xa0;m-deep fiber-optic monitoring borehole was established in Yan’an New District to investigate the unsaturated seepage process and its influence on soil behavior. Field studies indicated that the thick vadose zone can be divided into four parts, including two active zones interacting with atmospheric conditions. One of them is located at shallow ground, and the other one is positioned above the interface between compacted and natural loess. Piston flow and seasonal moisture changes dominate seepage in shallow active zone, leading to deformation governed by matric suction. In steady zones with slight water content variation, soil still experiences time-dependent deformation. The secondary consolidation coefficient (<i>C</i>_α) of compacted loess increases exponentially with depth, while natural loess shows lower and more stable values. In the deep active zone, preferential flow drives rapid water content increases and localized deformation. These findings support the development of deformation models considering different unsaturated seepage process.</p>