Straw checkerboard barriers (SCB) are widely employed for ecological restoration of habitats in the arid and semi-arid regions of the world. Through a field experimental study in 2018-2019, we evaluated the environmental effects of SCB with three treatments of border, center and outside the SCB (as the control) on several soil properties such as soil water content (SWC), soil organic carbon (SOC), total N, available P and available K. Furthermore, several key physiological traits of Medicago scutellata including plant height, leaf dry weight, chlorophyll and carotenoids, relative water contents, malondialdehyde and proline were measured in order assess growth performance of this plant in response to microhabitat condition provided by SCB. The results showed that SOC, total N, available P and available K significantly increased by 26%, 33%, 52% and 71% respectively, nine months after SCB establishments compared to the control. The SCB reduced water losses from the soil surface and enhance soil moisture retention and resulted in higher rates of growth, CO2 assimilation, and improved yields. Higher amounts of SWC (18-22%), leaf dry weight (183%), chlorophyll a (96%), chlorophyll b (93%), carotenoid (65%), and relative water contents (21%), were observed for individual of M. scutellata in SCB compared to control. The results also showed that the SCB resulted in the microhabitat modification of soil condition for growth characteristics of M. scutellata, particularly for border of SCB by improving SWC, which may affect nitrogenase activity and nodulation of M. scutellata. The results indicate that the barrier could create a microhabitat with improved factors that suit it for successful establishment, plant recovery and ecological restoration of arid and semi-arid areas.