Slopes in flysch deposits areas wide within Europe are highly prone to landslide occurrence. Depending on the material properties and climate conditions, instabilities in a form of earthflows, shallow and deep-seated landslides were observed in these formations. Typically, slope instabilities occurred after prolonged periods of rainfall. The Rječina River Valley, Croatia, built in flysch formation, is well known by several landslides occurred in the past. The weathering process of flysch rock mass and local climate conditions resulted in a specific engineering geological profile of the valley, with the unsaturated residual soil covering the bedrock. Although the behaviour of residual soil is important for a landslide triggering both through the rainfall infiltration process and (unsaturated) shear strength, hydro-mechanical properties of this material in unsaturated conditions were not investigated in the past. This paper summarizes the results of different laboratory tests performed on intact samples for hydro-mechanical characterization of the residual soil from flysch rock mass. It was found that the unique shear strength envelope could be used to determine failure conditions both for saturated and unsaturated conditions. The results obtained from strain-controlled and wetting tests performed in conventional and modified direct shear apparatuses indicated high values of the apparent cohesion that the near-surface soil can experience due to the increase of matric suction. The hysteresis effects and hydraulic paths to which soil was exposed to in the past were found to affect the soil behaviour, while the soil formation process results with a complex soil structure that imposes the necessity of using intact soil samples for proper hydraulic characterization of the soil.