In the aim of investigating the soil arching of geotextile-encased stone columns, we established a three-dimensional finite element model of geotextile-encased granular columns composite foundation under embankment load to analyze the influences of geotextile stiffness, column spacing and embankment height. Results indicated that the ratio of geotextile modulus to soil modulus which induced the start of soil arching was 20. The modulus ratio had little effect on soil arching after reaching 67. The height of soil arching increased linearly until the height of embankment reached 5 times of net spacing and then remained constant. The required height for a complete soil arching increased with the increase of net spacing. When net spacing reached twice the pile diameter, the height of soil arch remained stable. Moreover, with the increase of embankment height, the soil arch rate decreased gradually. When the height of embankment reached 1.7 times of net spacing to form complete soil arch, the soil arching rate did not change anymore. Compared with numerical results, we found that the results calculated by the three-dimensional soil arching method proposed by Hewlett and Randolph are the closest to the numerical results, and we suggest to use this method for design.