The study aimed to improve soil quality and crop productivity in a dry farming terrace in a hilly region. By using micro-water harvesting and fertilizer techniques, the soil properties were enhanced. Compared to traditional flat farming, the tillage soil layer increased by 25 cm, soil density decreased, and soil porosity and water retention capacity increased. Soil organic matter and nitrogen content improved significantly. Available nitrogen and phosphorus also increased. The soil temperature in the top layer increased, and there was a significant difference in soil moisture between test and control plots. This technique is important for controlling soil properties in hilly regions.