Numerical simulations were conducted based on the smoothed particle hydrodynamics–finite element method coupling method to investigate the damage evolutions and failure mechanism of reinforced concrete impacted by abrasive water jet. The response processes of damage and fragmentation of reinforced concrete were analyzed. The influences of key jet parameters on fracture characteristics of reinforced concrete were obtained. In addition, evolution laws of stress and damage and the failure mechanism of reinforced concrete impacted by abrasive water jet were revealed. The results indicate that the morphologies of broken pits undergo changes in the following sequence: V-shape, U-shape, and hourglass-shape. The broken pit range almost linearly increases with the impact time. Increasing abrasive concentration is more conducive to peeling concrete above steel, but an appropriate concentration is more suitable for cutting steel. Increasing jet diameter can expand the broken pit width, especially its bottom width, and increase damage to concrete below steel. The concrete stresses beneath steel display a raindrop-like distribution pattern. The concrete protective layer mainly suffers from the multiple stepwise damage accumulation failure caused by compressive shear and tensile stresses, and the interface concrete between steel and protective layer undergoes brittle failure due to weak bonding strength and massive stress concentration. The concrete beneath steel mainly undergoes brittle failure due to strong extrusion effect of steel. In addition, the concrete within steel reinforcement framework is influenced by various forces, such as tensile stress and shear stress, leading to occurrence of damage accumulation without failure. The research results would lay the theoretical foundation for abrasive water jet efficiently crushing reinforced concrete.