This paper presents an analysis of coupled hydrological-mechanical processes in the construction of tunnels using the compressed air technique. The compressed air is applied in the tunnel space during the construction to prevent a water inflow. The paper uses a methodology that links two computer codes TOUGH2 and FLAC3D such that hydrological-mechanical analysis can be conducted. An air flow test conducted in Essen, Germany, was simulated, and the results agreed well with the field measurements. Subsequently, a numerical simulation of compressed air tunneling was performed to analyze the air injection rate and the surface displacements. The calculated air losses from the tunnel are within the range of the field observations. The analysis of surface settlement shows upward heaving and a decrease in the magnitude of surface settlement, which is consistent with the field observations.