The rubber dam has superior water retaining ability, practicability, and a good landscape, which is widely used as urban river water retaining dam and weir. The air-inflated rubber dam is more convenient to install and dismantle than the water-inflated rubber dam. However, at present, the air-inflated rubber dam is roughly designed by the look-up table method, which is complicated and has errors. In this paper, a large scale model test is conducted to test the sectional shape and the tension of the air-inflated rubber dam under the conditions of inflation and water retaining. And a finite-difference model for the water-retaining ability of an air-inflated rubber dam is established, which is confirmed by large-scale model tests and existing design specifications. The relationship between the cross-section shapes and sizes, the tensions and the upstream water levels, and the internal air pressure of the rubber dam during the water retaining process is analyzed. It is found that the width B and contact width b nonlinearly increases with the increase of the upstream water levels, whereas the height H and cross-sectional area A decrease nonlinearly. Under the design conditions, the height H and cross-sectional area A nonlinearly increase with the increase of internal air pressure, whereas the width B and contact width b decrease nonlinearly. The tension T is proportional to the internal air pressure. Based on the Chapman-Richard model, the geometric dimensions, tensions and internal air pressure are fitted under the design conditions, and the simplified design calculation formulas are obtained, which can be used for the design of the air-inflated rubber dam project.