Hydraulic behaviour of compacted smectite-rich clays is of practical interest in geological disposal of high-level nuclear waste, as the buffer component of the engineered barrier system. Despite several decades of research, a sound theoretical description of the unsaturated hydraulic conductivity of clay buffer (compacted bentonite) and its performance remains challenging. This is evidenced by experimental data on unsaturated hydraulic conductivity, which, albeit limited, show that the hydraulic behaviour of compacted bentonite during confined wetting is considerably different from that typically observed in non-expansive clays. This work addresses the challenge by proposing a predictive model for the saturated and unsaturated hydraulic conductivity of compacted smectite under confined wetting. By considering the microstructure evolution of compacted smectite, a theoretical description of its pore system variations with relative humidity is presented based on a geochemical modelling approach. The Kozeny–Carman (KC) relationship for hydraulic conductivity of compacted smectites is revisited as a basis to derive a new model, which also incorporates more accurately the effects of key properties, such as porosity, specific surface area and tortuosity. The model predictions for saturated hydraulic conductivity for four types of bentonite clays (GMZ, Kunigel-V1, MX-80 and FEBEX) show close correlations with the experimental data. The results of model prediction for unsaturated hydraulic conductivity of compacted bentonite are in close agreement with the experimental data over a large range of suction values.