Abstract: A strong earthquake occurred in Dangjiang area, northwest of Yushu, Qinghai province, which caused nearly 260 casualties in 1738 AD. The previous earthquake catalog determined the epicenter of this historical earthquake is nearly Yushu with an estimated magnitude of 6½. However, because of the conditions such as high altitude and inconvenient transportation, there is still controversy on coseismic deformation characteristics. Based on the interpretation of satellite images and the field geological survey, we found that the Dangjiang segment of the Garzê-Yushu fault zone was clearly activated, which forming a left-lateral strike-slip coseismic deformation zone of about 120 km in length, with the maximum coseismic displacement of 3.6 ± 0.1 m. A series of modern gully faults, terraces and fault scarps have been developed along the fault zone. Based on the analogy of earthquake cases and the empirical formula of coseismic surface rupture length and maximum coseismic displacement results, the magnitude of this earthquake is re-estimated at M7½. It is discussed that the elapsed time of the 1738 earthquake in the Dangjiang segment is close to its strong earthquake recurrence interval, and there is an obvious rupture gap between the Dangjiang fault and the Yushu fault, and its potential for large earthquakes cannot be underestimated.