In order to extend the recycling of waterworks sludge to engineering applications, this paper addresses the influence of nano-SiO2 on incinerated waterworks sludge ash (IWSA) cement paste attacked by sulfate. Tests were performed such as length measurement for volume change, compressive strength, weight loss, and micro-structural testing using scanning electron microscopy (SEM). The results indicate that when a portion of the cement in the paste was replaced by IWSA, the IWSA diluted the cementitious material C3A, and filled the capillary pores in the hardened paste. Moreover, since IWSA has potential pozzolanic activity, it can chemically react with Ca(OH)2 crystals in the paste and can consequently improve the resistance of the paste to sulfate attack. Test results also show that due to the fully developed pozzolanic effect of IWSA, the major reaction products of sulfate attack, gypsum and ettringite, were clearly reduced. Hence, the expansion rate in length decreased with the increase of IWSA replacement. Furthermore, the addition of nano-SiO2 to IWSA cement paste can also reduce the length expansion rate.