Soil nitrogen availability is a major constraint to crop productivity in rainfed arid and semi-arid regions. The influence of straw strip mulching on nitrogen availability and transformation across soil layers remains unclear. This study investigates the effect of straw strip mulching on soil nitrogen dynamics and crop-specific variation in wheat- and potato-cultivated soils under rainfed semi-arid conditions. This study consisted of five mulching treatments, including without mulching (Tck), black plastic film mulching (Tp), straw strip mulching (Tss), plant strip without mulch (Tps), and composite strip of straw strip mulching and plant strip without mulch (Tcs) applied in wheat and potato cultivation during 2019 and 2020, and soil nitrogen fractions were determined across different soil depths. Tss mulching showed the highest increase in urease activity (48%), nitrite reductase activity (48%), microbial biomass nitrogen (52%), NH₄ (11%), acid-hydrolyzed total nitrogen (10%), acid-soluble NH₄ (6%), acid-hydrolyzed amino sugar (16%) and acid-hydrolyzable unknown nitrogen (59%) relative to Tck without mulching. While total nitrogen (11%) and acid-hydrolyzed amino acid (9%) were highest in the Tps treatment compared to Tck treatment, the mulching treatment had no significant effect on soil organic nitrogen-derived functional traits. Across all treatments, the 0–20 cm soil layer consistently showed the highest concentrations of observed soil traits, which declined with increasing soil depth. Furthermore, potato-cultivated soils showed consistently higher concentrations of these traits than wheat-cultivated soils, and the concentrations of these traits in 2020 exceeded those observed in 2019. This study highlights that maize straw mulching in strips significantly promotes soil organic nitrogen fractions, particularly in the upper soil layers, and promotes higher nitrogen availability in potato than in wheat-cultivated soils, and is recommended as an effective soil management practice to improve soil nitrogen availability in rainfed semi-arid Loess Plateau conditions.