Abstract: In order to study the effect of grassland ecological protection award and subsidy policy, the change of livestock production and pastoralists’ income in pastoral and semi-pastoral area was analyzed. The results showed that the slaughter of beef cattle and beef yield were basically stable after implementation of the policy. The inventory and slaughter of sheep, mutton yield and milk yield increased to some extent. The net income per capita of farmers and pastoralists, livestock income, the proportion of livestock income in the total income kept a continuing increase. Finally, the authors put forward suggestions including transforming livestock production mode, increasing the income of farmers and pastoralists and perfecting supporting policies of grassland ecological protection award and subsidy policy.