Studies on the assessment of green infrastructure (GI) practice implementation effect and cost efficiency on an urban watershed scale helps the GI practice selection and investment decisions for sponge city construction in China. However, few studies have been conducted for these topics at present. In this study, the Long-Term Hydrologic Impact Assessment—Low Impact Development (L-THIA-LID) 2.1 model was applied to assess the effectiveness and cost efficiency of GI practices on surface runoff volume reduction in an urban watershed—the Hexi watershed, Nanjing City, China. Grassed swales, bioretentions, green roofs, rain cisterns, permeable pavements, wet ponds, dry ponds, and wetlands were chosen as potential GI practices for sponge city construction based on feasibility analysis. Results showed that grassed swales were the most cost-effective practice (0.7 CNY/m³/yr), but the total implementation effect of grassed swales was not obvious due to the small area of suitable locations. Permeable pavements performed best on runoff reduction, but the cost efficiency was much lower. Correspondingly, bioretentions were compromise practices. Green roofs were the least cost-effective practices, with the cost efficiency at 122.3 CNY/m³/yr, but it was much lower for rain cisterns, which were 3.2 CNY/m³/yr. Wet ponds, dry ponds, and wetlands were potential practices implemented in development areas, of which dry ponds were the most cost-effective (2.7 CNY/m³/yr), followed by wet ponds (10.9 CNY/m³/yr). The annual runoff volume of the total area could be reduced by up to 47.01% by implementing GI practices in buildup areas. Rain cisterns (RC) and permeable pavements (PP) were the best combination for this area, and bioretentions (BR) and green roofs (GR) followed. Grassed swales (GS₁), dry ponds (DP), wet ponds (WP), and wetlands (WL) were not wise choices due to the small suitable location areas. This study also demonstrated the feasibility of the L-THIA-LID 2.1 model for the evaluation of GI practice implementation effects and cost efficiency on urban runoff in sponge city construction in China.