The service performance of frozen soil is one of the important factors that needs to be considered in designing and assessing the safety of artificial ground freezing projects. We conducted shear tests on ice-containing frozen soil and assessed soil performance and damage characteristics of the ice-frozen soil interface. On the basis of experimental results, we further investigated the damage of ice-containing frozen soil numerically using the finite-discrete element method. Experimental and numerical results show that temperature, the normal load, and moisture content are the primary factors influencing the mechanical properties of the ice-frozen soil interface. The effects of these parameters on shear strength, shear modulus, cohesion, and angle of internal friction were analyzed and discussed. There was a transition from ductile to brittle behavior at the ice-frozen soil interface with decreasing temperature. Transition occurred at higher temperatures in soils with higher moisture content. Because ice and sand differ in terms of stiffness, fractures appeared first at the ice-frozen sand interface. Under continued loading, the specific form of damage and maximum load-bearing capacity varied as a function of the location of the maximum shear stress zone and the ice in the soil. Our research findings provide valuable theoretical insights for the design and evaluation of the safety of artificial ground freezing engineering projects.