In order to investigate the microstructure evolution and the degradation mechanism of SiC fiber in a high-temperature oxidative environment, the SiC fiber was thermally exposed at temperature up to 1600 °C in air. The morphologies of the surface and fracture surface were characterized by scanning electron microscopy. The consisting phase and crystallite size were analyzed by X-ray diffractometer. The mechanical properties of SiC fiber was characterized by a single-fiber tensile test technique. It was found that an obvious grain coarsening occurred at temperature above 1400 °C. A visible silica layer was formed at 1300 °C, and the morphology of silica layer was dependent on the exposure temperature. At 1400 °C, fiber surface formed a thick silica layer with cracks, while the silica layer exhibited a multilayered structure at 1600 °C. As for the tensile strength of fiber, it firstly decreased to about 1 GPa at 1200 °C, then the strength was maintained at 1400 °C. After thermal exposure at 1500 °C and 1600 °C, the strength decreased again. The degradation of mechanical properties was attributed to the grain coarsening and the decomposition of amorphous phase in fiber. Particularly, the decomposition of amorphous phase would damage the structure integrity of fiber. The current work would provide a valuable reference for research and application of SiC fiber.