To investigate the safety threats posed by dramatic water-level changes during the flood season to shield tunneling beneath embankments along the Yellow River, a large-diameter underwater shield tunnel project at Jiluo Road was taken as the engineering background, in which the influences of water level height and its variations were considered, and the settlement behavior and safety of the embankment under the condition of a double-track shield tunnel passing beneath it were analyzed. A three-dimensional finite element model was established for the large-diameter shield tunnel passing under the embankment on the north bank of the Yellow River, utilizing the principles of fluid-solid coupling and the strength reduction method, accounting for the time-dependent effects of water level changes. The construction process was simulated in detail, and the simulation results were compared with field monitoring data to validate the model. The settlement and safety characteristics of the embankment under different water levels and after water level changes were analyzed. The results indicate that the settlement induced by shield tunneling under flood water level conditions is approximately 12% greater than that under normal water levels. Moreover, the impact of dynamic water level fluctuations far exceeds that of the shield tunneling itself. A sudden rise in the water level causes embankment rebound and lateral soil uplift adjacent to the tunnel, whereas a sudden drop leads to a sharp increase in settlement. Shield tunneling beneath the embankment has a relatively minor effect on its overall safety, while sudden water level changes exert a more pronounced influence. Specifically, a sudden water level rise enhances embankment stability, whereas a sudden drop significantly compromises it. The magnitude of water level rise shows a negative correlation with settlement, while the extent of water level decline exhibits a positive correlation. Furthermore, the influence of water level decline on embankment deformation is significantly greater than that induced by shield tunneling. Under extreme climatic conditions, a “rise-then-fall” water level scenario may cause settlement to exceed the safety threshold, aggravate differential settlement, trigger local instability, and promote embankment displacement toward the riverside.