The influence of fulvic acid (FA) contamination on the residual shear strength of red clay is an important issue in geological engineering. This study examines the effects of FA contamination on the shear strength, mineral composition, and microstructural changes in Guilin red clay using drained repeated direct shear test, along with X-ray diffraction (XRD), scanning electron microscopy (SEM), and particle and pore structure analysis system (PCAS). The results indicate that a low FA concentration (mFA/mRC = 2%) combined with short-term immersion (approximately 7 days) enhances the residual shear strength of red clay, primarily through increases in cohesion and internal friction angle. However, higher FA concentrations (mFA/mRC ≥ 4%) and prolonged immersion (≥ 21 days) lead to a significant reduction in shear strength, with the most notable decrease observed at mFA/mRC = 6% and t = 21 days, where cohesion decreased by approximately 42%, and the friction angle decreased by approximately 36%. XRD results show that FA contamination does not significantly alter the mineral composition, but it leads to the dissolution and transformation of calcite and illite, thereby altering their relative abundances. SEM observations suggest that short-term FA contamination promotes particle aggregation and pore filling, resulting in a denser microstructure and increased shear strength. In contrast, prolonged contamination causes a reduction in particle size, increased porosity, and a more loosely packed structure, ultimately weakening the soil’s shear strength. The study proposes a dual adsorption mechanism: at low FA concentrations, FA enhances soil aggregation through the formation of “organic–inorganic bridges,” while at high concentrations, it induces interparticle repulsion through the development of a hydrated organic film, leading to structural loosening and strength degradation. These findings provide insights into the complex mechanisms by which FA contamination affects the mechanical properties of red clay, offering a theoretical foundation for geotechnical design and safety assessments in FA-affected regions.