The objectives of this study were to quantify the characteristics of water transport and conservation in different locations (the inner field, paddy bund, and irrigation canal) in the paddy inner field-bund transition zones, and to identify the dominant pathways for water flow in these zones. Two typical transition zones in a more than 100-year paddy field were investigated by soil sample analysis and dye tracing field experiment in the Jianghan Plain, Hubei Province. Saturated hydraulic conductivity (Ks) decreased with increasing soil depth for each site, and was characterized by higher standard deviation in the upper soil layers. The highest Ks was observed in the paddy bunds, followed by the irrigation canal, and the lowest in the inner field, indicating that the water preferred to flow through the paddy bunds. In addition, significant differences in soil water retention curves (SWRC) were observed, the highest soil water-holding capacity was identified in the inner field, followed by the irrigation canal, and the lowest in the paddy bunds. The macroporosity calculated based on the SWRCs revealed that there were more macropores in the bunds than in the inner field, which resulted in more preferential flow paths. Corresponding to the macropore distributions, the larger stained area ratio (SAR) of the lower soil layers was also observed in the paddy bunds than in the inner field. Different soil Ks and water capacity between the inner field and paddy bund could be mainly attributed to the enhanced macroporosity in the bunds, which was mainly resulted from soil animal activation and root penetration. Except for the vertical water infiltration in the inner field, two other water flow paths in the paddy inner filed-bunds transition zone were identified: (i) water flowed laterally into the paddy bund and percolated vertically into the deep soil layers quickly through the macropores; (ii) water transported laterally into the irrigation canal firstly, then percolated vertically into the deep soil layers. In conclusion, water losses from the paddy bunds should be considered seriously in the water and solute transport researches in the paddy field in the Jianghan Plain.