Engineering practice and studies show that the narrow excavation designed according to the traditional foundation pit theory is conservative and causes a large engineering waste. Based on size effect of excavation, with the help of finite element software ABAQUS, the retaining structure model of semi-infinite space elastomer and infinite space elastomer was established to simulate the mechanical properties of pile support envelope under different combinations of the excavation depth H, the embedded depth of retaining pile D and excavation width B. Based on the anti-overturning stability theory and the circular slip theory, the inner relationship between H, D and B as well as the stability of excavation is deeply analyzed. In the actual working conditions, the critical width of excavation is determined based on the restraint effect of retaining structures on the soil at the bottom of the pit, and excavation is classified accordingly, applicability of the existing codes in the design is defined. The research results can guide the design and construction of narrow excavation, which will bring better engineering benefits and social benefits.