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It is generally believed that plantations of Eucalyptus bring about a decrease in soil fertility. Soil physicochemical and microbiological properties were measured across a range of E. grandis plantation ages (1–10 years) in south-western China to determine whether and how eucalypt afforestation of agricultural land affected the soil fertility. The results indicate that afforestation with E. grandis caused changes in soil properties with soil depth, and the changes were dependent on the stand age. Soil bulk density decreased significantly, but water-holding capacity increased significantly with time. Soil organic matter content, C:N ratio, and soil microbial biomass C and N concentrations showed an initial phase of decline and then increased significantly over time in the upper soil layers of E. grandis plantations aged from 1 to 4 or 5 years. Soil pH in E. grandis plantations did not change significantly with stand age or soil layer. Cation exchange capacity in the upper soil layer of E. grandis plantations increased significantly over time. Total exchangeable bases and base saturation in the soil decreased significantly with depth and with increasing plantation age. Furthermore, E. grandis afforestation of arable soils had no significant effects on total N, total P, and available P contents. The requirements of the trees, understory microenvironmental conditions, and allelopathic effects might play important roles in the dynamic changes of soil physicochemical and microbiological properties. The results demonstrate the progressive development of processes that lead to the restoration of soil fertility following E. grandis afforestation of arable soils. However, most of the properties measured for the afforested soils resembled the properties of arable soils and did not resemble those of the soil of control forests. Thus, reversion of soil properties in the study plantations is likely to require a considerable period of time. Long-term research is needed to understand changes in the soil properties resulting from afforestation with Eucalyptus and to predict future trends.