Soil erosion is a major global environmental problem that has caused many issues involving land degradation, sedimentation of waterways, ecological degradation, and nonpoint source pollution. Therefore, it is significant to understand the processes of soil erosion and sediment transport along rivers, and this can help identify the erosion prone areas and find potential measures to alleviate the environmental effects. In this study, we investigated soil erosion and identified the most seriously eroded areas in the East River Basin in southern China using a physically-based model, Soil and Water Assessment Tool (SWAT). We also introduced a classical sediment transport method (Zhang) into SWAT and compared it with the built-in Bagnold method in simulating sediment transport process along the river. The derived spatial soil erosion map and land use based erosion levels can explicitly illustrate the identification and prioritization of the critical soil erosion areas in this basin. Our results also indicate that erosion is quite sensitive to soil properties and slope. Comparison of Bagnold and Zhang methods shows that the latter can give an overall better performance especially in tracking the peak and low sediment concentrations along the river. We also found that the East River is mainly characterized by sediment deposition in most of the segments and at most times of a year. Overall, the results presented in this paper can provide decision support for watershed managers about where the best management practices (conservation measures) can be implemented effectively and at low cost. The methods we used in this study can also be of interest in sediment modeling for other basins worldwide.