A 3-year experiment was conducted in an extremely dry and saline wasteland to investigate the effects of the drip irrigation on salt distributions and the growth of cotton under different irrigation regimes in Xinjiang, Northwest China. The experiment included five treatments in which the soil matric potential (SMP) at 20 cm depth was controlled at -5, -10, -15, -20, and -25 kPa after cotton was established. The results indicated that a favorable low salinity zone existed in the root zone throughout the growing season when the SMP threshold was controlled below -25 kPa. When the SMP value decreased, the electrical conductivity of the saturation paste extract (EC e) in the root zone after the growing season decreased as well. After the 3-year experiment, the seed-cotton yield had reached 84% of the average yield level for non-saline soil in the study region and the emergence rate was 78.1% when the SMP target value was controlled below -5 kPa. The average pH of the soil decreased slightly after 3 years of cultivation. The highest irrigation water use efficiency (IWUE) values were recorded when the SMP was around -20 kPa. After years of reclamation and utilization, the saline soil gradually changed to a moderately saline soil. The SMP of -5 kPa at a depth of 20 cm immediately under a drip emitter can be used as an indicator for cotton drip irrigation scheduling in saline areas in Xinjiang, Northwest China.