To avoid crashing into people going through the rail or other obstacles and improving the system’s safety and stability, an obstacle avoiding system of mountain orchard steel wire rope traction cargo vehicle was designed. The system was composed of STC single-chip micro-controller, ultra-sonic range measurement modules, infrared detection unit, wireless communication module, voice alarm and manual control module. The system was designed to achieve an obstacle detection distance of no less than 150 cm and a 100% successful braking rate. System verification test results indicated that: when using static obstacle, the minimum vehicle-to-obstacle distance was 100 cm after uphill brake and the minimum vehicle-to-obstacle distance was 90 cm after downhill brake. When using motion obstacle, the minimum vehicle-to-obstacle distance and time delay were 98 cm and 0.64 s, respectively after uphill brake. The minimum vehicle-to-obstacle distance and time delay were 66 cm and 1.30 s after downhill brake.