Landslide‐dammed lakes are potentially hazardous and catastrophic for their possible failures and outburst floods (OFs) that will cause disastrous damage and life‐threatening losses, especially in the alpine areas where seismicity is strong and frequent, such as the eastern margin of the Tibetan Plateau. This study focused on spreading an effective numerical model to reconstruct downstream hazards induced by a giant ancient landslide‐dammed lake outburst flood (LLOF) in the upper Minjiang River valley, eastern Tibetan Plateau based on the integration of the hydraulic characteristics of the upstream dammed lake, dam failure and erosion process, and downstream OF dynamics. The peak discharge levels and paleohydraulics of the LLOF were reconstructed using single‐embankment dam‐break program and one‐dimensional steady hydraulic numerical model. The results reveal that the maximum peak discharge of the Diexi paleo LLOF was 73,060–82,235 m3/s, with an uncertainty bound of 73,000–90,000 m3/s (mean value: 81,500 m3/s). Which inferred that the Diexi paleo LLOF was one of the largest known LLOFs in the view of worldwide scope comparing with other types of floods. Then, the hydraulic characteristics and route evolution of the LLOF were simulated in one‐dimensional unsteady numerical model. The results showed that the Diexi paleo LLOF took 7.47 h to transport from Diexi to Wenchuan within the simulated section of 91.23 km, with an average propagation velocity of 3.39 m/s. At the time of 15.57 h, the simulating section (between Diexi and Wenchuan) reached the maximum extent of inundation which was 664.91 km2, with an average value of 7.29 km2/km. Our modeling supports that the numerical model can be used successfully to reconstruct the hydraulics of a paleo LLOF in deep confined gorge environment. The reconstructed paleo LLOF data are of great significance to enrich the regional megaflood records and provide valuable information for geological hazard controls and OF risk assessment within the upper catchment of Minjiang River at the eastern margin of the Tibetan Plateau.