The coupled pretreatment of orange peel with steam explosion (SE) and sulfuric-acid soaking (SAS) was investigated to enhance the yield and improve the functionality of soluble dietary fiber (SDF). When orange peel was pretreated by SE at 0.8 MPa for 7 min, combined with 0.8% SAS, the content of SDF was increased from 8.04% to 33.74% in comparison to the control and SDF prepared with SE–SAS showed the high water solubility, water-holding capacity, oil-holding capacity, swelling capacity, emulsifying activity, emulsion stability and foam stability. SDF from orange peel treated by SE–SAS exhibited significantly (p < 0.05) higher binding capacity for three toxic cations (Pb, As and Cu) and smaller molecular weight (Mw = 174 kDa). Furthermore, differential scanning calorimetry (DSC) measurement showed that SDF from orange peel treated by SE–SAS had a higher peak temperature (170.7 ± 0.4 °C) than that of the untreated sample (163.4 ± 0.3 °C). Scanning electron micrograph (SEM) images demonstrated that the surface of SDF from orange peel treated by SE–SAS was rough and collapsed. It can be concluded that SDF from orange peel treated by SE–SAS has the higher potential to be applied as a functional ingredient in food products.