<p>To investigate the instability of dangerous rock masses on mountain slopes subjected to tunnel blasting, a mountain-crossing tunnel near a residential area in Guangxi was selected as the engineering background. Tunnel model tests and PFC2D discrete element simulations were conducted, combined with digital image correlation (DIC) and piezoelectric thin-film stress wave monitoring. The displacement field, deformation evolution, stress wave propagation, fracture development, and instability mechanism of the slope under blasting disturbance were systematically investigated. The results show that blasting vibration propagates outward from the borehole and gradually attenuates, but local dynamic amplification occurs on the tunnel flank exposed to the explosion source and in the middle of the slope due to stress wave superposition. The peak vibration velocity attenuates from 2 to 0.028 m/s. In the local middle area, a significant response enhancement occurs. The stress wave responses around the blasthole exhibit comparable attenuation trends along the left, upper, and right directions as the propagation path lengthens. On the right side of the borehole near the tunnel, the peak horizontal and vertical vibration velocities are largest at the blasting side of the first tunnel haunch and smallest at the rear blasting side. On the left side, the peak horizontal velocity first increases and then decreases from the toe region upward to the crest. The peak vertical velocity first decreases, then increases, and finally decreases. The maximum surface particle velocity is consistent with the peak velocity in the middle slope. The instability mechanism is jointly controlled by local stress wave superposition and bond weakening in the lower part. It manifests as a progressive damage evolution process induced by local dynamic amplification. The research findings provide a theoretical basis for the blasting excavation design and slope stability assessment of cave projects near residential areas.</p>