Trace elements contamination in sediment is regarded as the global crisis with a large share in developing countries like China. Water and sediment samples were collected during (2016) from Qingshui Stream and analyzed for major physicochemical properties and trace elements by using ICP-MS. Our result of sediments showed that studied trace elements (except Pb, Cd, Co) had a concentration higher than Chinese sediment guideline as well as stream water data for studied trace elements (except Cr, Pb, Cd, Cu, and Zn) had a higher concentration than the maximum permissible safe limit of WHO. Contamination factor (CF) confirmed a moderate to high contamination in the sediment samples due to As and Tl, respectively. The values of pollution load index (PLI) were found above one (> 1), describing the progressive sediment quality decline. Pearson correlation showed that there was a significant positive association between Tl and As (r = 0.725, p < 0.05) in sediment samples. Results revealed that water-rock interaction, weathering of Tl sulfide mineralization, and hydrogeological conditions were major sources of stream water and sediments contamination in the study area. This experimental study contributes to a better understanding of the geochemistry and prevention of trace element contamination in sediments from Lanmuchang area.