Regolith-hosted rare earth element (REE) resources in South China are the dominant global source of heavy REEs (HREEs), which are critical for high technology and military industries. Most previous studies focused on the proportion of ion exchangeable REE fractions, but other speciations thereof and their effects on REE fractionation are still poorly understood. Therefore, to address this issue, this study focused on a systematic analysis of the geochemistry and mineralogy of a complete weathering 78 m profile in the Renju regolith-hosted REE deposit in northeast Guangdong Province, China. In the quartz diorite bedrock, the main REE minerals were titanite, allanite, and REE fluorocarbonates abundant in REEs (332–338 ppm). During the breakdown of rocks due to weathering, the light REE (LREE)-rich minerals, e.g., titanite and allanite, were dissolved preferentially, resulting in the release of the REEs. Thus, the HREE-rich minerals, including xenotime and zircon, are preserved with progressive weathering. The results of sequential extraction show that the activated REEs are immobilised, occurring mainly as ion exchangeable and Fe-Mn (hydr)oxide fractions, with a few amounts of the organic and carbonate binding fractions. Fe (hydr)oxides, as seen via transmission electron microscopy, usually occur in the form of goethite and hematite in the lower and upper parts of regoliths, respectively, while Mn is present as a trace element in Fe (hydr)oxides. The lower La/Yb ratios in the Fe-Mn (hydr)oxide fraction indicate that HREEs are preferably bonded on Fe-Mn (hydr)oxides, causing LREEs to exist mainly as ion exchangeable fractions. In addition, positive Ce anomalies exist in both the lateritic horizon with strong oxidation of weak acid and in the Fe-Mn (hydr)oxide fraction as a co-precipitate with Fe oxides. The results obtained advance our understanding of the mechanisms of REE fractionation and the mutual effect of REE speciation on the formation of regolith-hosted REE deposits in South China.