Although a land consolidation project has increased arable land area in loess areas, the loessal soil has poor fertility and productivity. Soil degradation and the accompanying decline in crop yields are the main limiting factors for agricultural development on the Loess Plateau. Biochar has been used as an amendment to improve soil fertility and crop yields. A potted experiment was carried out to study the effects of biochar addition (0, 5, 15 and 25 t ha⁻¹) on soil physicochemical properties as well as sunflower yield. The results showed that higher rates of biochar addition (15, 25 t ha⁻¹) can significantly increase soil electrical conductivity, cation exchange capacity, nutrients and crop yields, while decreasing soil pH. The maximum soil nutrients were observed at 25 t ha⁻¹ biochar addition. However, the lowest soil pH value and highest sunflower seed yield were obtained at 15 t ha−1 biochar addition. The highest net income was $985 ha⁻¹ when the biochar addition rate was 15 t ha⁻¹. These results suggest that biochar can significantly improve soil fertility and sunflower yield. Soil salinity and alkalinity properties, organic carbon, nitrate nitrogen and available phosphorus were crucial factors that determined soil fertility and sunflower yield in loessal soil.