Abstract: Investment is an important means by which national economic and social development are promoted. The cost and benefit-distinguishing quality of an investment have direct influences on the appraisal result of an investment project. From the viewpoint of guaranteeing the benefit of thewhole country, by use of a concept of radiating effect, andwith the direct and indirect actions between projects being fully considered, thought and method for distinguishing the cost and benefit of national investment project are presented, with an example applied to a railway construction project. In thismethod, much attention is paid tothe distinguishing of non-economic benefit. It provides an effective benefit distinguishing method for quantitative analyses of construction project appraisal, and it is easy to be practically operated and suitable to be used in the appraisal of national investment projects.