Human activities and food production are bound to affect resources and the environment. For a long time the direct costs of food production have been calculated while ignoring ecological loss costs. The correct assessment of the ecological costs of food production is important. Such assessments can be used to properly evaluate the economic benefits of agricultural production, to realize sustainable development of the ecological economy, to regulate food production patterns, and to develop industrial policies. In this paper, statistical and household survey data from Qiyang County were analyzed using economic and ecological methods to investigate the ecological costs of food production in the hilly red soil region of southern China in 2008. In order to explore the ecological costs of food production more accurately, this study analyzed both the costs of ecological loss and direct production. In other words, ecological costs are equal to the costs of ecological loss plus the costs of direct production. The costs of ecological loss refer to the negative impact of food production on the ecological environment and include soil loss costs, nutrient loss costs, water pollution costs, and costs related to the loss of land resources and water conserving ability. Direct production costs refer to the costs of planting from sowing to harvest, including costs related to seeds, chemical fertilizer, organic fertilizer, pesticides, plastic film, irrigation, agricultural machinery, and labor. The results showed that ecological damage due to grain production in this region was equivalent to 4.85% of the total agricultural output in 2008. Once the ecological environment has been severely damaged, sustainable development of the ecological economy faces a severe test. Ecological costs in this region reached 3.18 Yuan/kg for early-season rice, 2.44 Yuan/kg for mid-season rice, and 3.02 Yuan/kg for late-season rice in 2008. However, unit sales were 1.76 Yuan/kg for early-season rice, 1.90 Yuan/kg for mid-season rice, and 1.84 Yuan/kg for late-season rice. Rice production resulted in financial loss to agriculture producers and resulted in a negative attitude among the laborers. The combination of high production costs and low income have affected sustainable development in this region and become a threat to the area's food security. Principal component analysis of the various factors affecting the ecological costs of food production in the hilly red soil region of southern China showed that, under current production conditions, moderate increases in the use of chemical fertilizer, pesticides, agricultural machinery, plastic film, and labor inputs would reduce the ecological costs of rice production. Rice yield and organic fertilizer inputs are important factors affecting the ecological costs of rice production. Irrigation costs have little effect on ecological costs in this region because of the abundance of water resources. Ecological costs of rice production in this region declined as the amount of cultivated land per family increased. This indicates that if the government expands the scale of family agricultural production in the hilly red soil region of southern China, then the ecological costs of rice production would be reduced, the economic efficiency of agricultural production would be increased, and the mood of agricultural workers would be improved. These changes would be conducive to achieving sustainable development of the ecological economy of this region.