The Xiaojiang fault is a major active left-lateral fault along the southeastern margin of the Tibetan Plateau. The largest historical earthquake in Yunnan Province, with a magnitude 8 and a mean coseismic left-lateral displacement of ~ 6.9 m, occurred on the western branch of the Xiaojiang fault. Studying this fault is important in understanding current deformation and kinematic characteristics of the Tibetan Plateau. Activities and stretches have been well undertaken on the Xiaojiang fault, while paleoseismic research work is always the weak link on this fault. To investigate the paleoseismic history and large earthquake activity of the Xiaojiang fault, we opened a large trench at the northern edge of Caohaizi sag pond on the western branch of the Xiaojiang fault. Six paleoseismic events have been identified, and named E1 through E6 from the oldest to the youngest. Charcoal and woods are abundant, 20 samples were dated to constrain the ages of the paleoseismic events at 40?000–36?300?BC, 35?400–24?800?BC, 9?500?BC–AD 500, AD 390–720, AD 1120–1620 and AD 1750–present. We associate the youngest event E6 with the 1833 M8 earthquake. Events E4, E5 and E6 show a continuous record of the western strand of the Xiaojiang fault in the late Holocene, with a average recurrence interval of 370–480 yr. Large earthquake recurrence in the late Holocene is far less than the recurrence of 2000–4000 yr posed in previous studies. Thus, the seismic hazard on the Xiaojiang fault should be reevaluated. Furthermore, the irregular recurrence of large earthquakes on the Xiaojiang fault and other faults in the Xianshuihe-Xiaojiang system, indicates the uneven southeastward extrusion of the Sichuan-Yunnan block along the southeastern margin of the Tibetan Plateau.