We review the recent progress in studies of air-land interaction over the arid area of Northwest China and its impact on climate. The paper examines the analyses of the data observed continuously during the Field Experiment on Air-Land Interaction in the Arid Area of Northwest China (NWC-ALIEX) for 12 years and during many Intense Observation Periods of this project. The analyses of the land-surface parameters and studies of the characteristics of the boundary layer and air-land interaction in the arid area from continuous observations were reviewed as well as applications of these parameters to optimize the parameterization scheme in land surface models and to improve related land surface models. Moreover, we examined the characteristics of sensible heat transfer in the arid area of Northwest China and the impact of the air-land interaction in this area on climate variability in eastern China and its physical mechanism. We found a feature of high sensible heat transfer in spring and summer in the arid area of Northwest China, which has a strong impact on climate variability in eastern China. Finally, the issues that need further study and evaluation are also pointed out in this paper.