Plant litter is an important component of forest ecosystems and has a key role in reducing soil and water loss. This study evaluated the effect of land use change on rainfall interception and other hydrological processes associated with the litter layer in the tropical region of Southwest China, where large areas of tropical rainforest (TR) have been converted into rubber monoculture (RM) in the past decades. Two litter types from the TR and RM were selected to determine the maximum water storage capacity (S), maximum and minimum interception storage capacities (i.e., C-max and C-min respectively) and moisture dynamics under four litter masses and five simulated rainfall intensities. Results showed that the distribution of litter layer in the RM had a higher spatial variability than that in the TR. The average litter thickness in the TR and RM was 6.42 and 4.43 cm, respectively, and the S value of the litter layer in the TR and RM was 1.44 and 1.03 mm, respectively. Linear relationships among litter thickness, S, and litter mass were observed. The average C-max and C-min in the TR were respectively 1.25 and 1.30 times greater than that in the RM. Significant positive relationships among litter mass, rainfall intensity, and interception storage capacity were observed, indicating that litter mass and rainfall intensity played a critical role in determining rainfall interception of the litter layer. TR litter from mixed species had larger leaf surface area and higher water affinity, which resulted in 1.38 times greater litter interception (12.32%) than RM litter (8.96%). These results indicated that the conversion of TR into RM considerably weakened the hydrological functions of forest litter, such as water storage capacity and rainfall interception, and possibly subsequent erosion control. Introducing native rainforest species into rubber plantations can help improve the litter input and the hydrological attributes of forest litter.