Grassland is an essential ecological asset and a productive resource,which means that it has an impor‐ tant strategic position in China’s social and economic development. Implementation of the compensation for grassland policy is an important measure that helps to accelerate the construction of ecological civilization. In addition,the policy is of great significance to the sustainable development of the ecological environment and poverty reduction in pastoral regions. This study investigated the two rounds of compensation policy by analyzing the statistical data over the years, consulting the almanac,and field study. The changes in livestock carrying capacity and the grassland productivity,eco‐ nomic,and social benefits of different grassland types before and after implementing the policy were analyzed. The re‐ sults showed that 1) The average fresh grass yield in Gannan Prefecture reached 6 534. 00 kg/hm2 after the imple‐ mentation of the two rounds of policy,which increased by 17. 61% after the first round of policy,and 16. 28% in the second round compared with the first round;2) The total output value of livestock industry in Gannan Prefecture in‐ creased significantly,and the theoretical livestock carrying capacity increased by 30. 45% after the first round of policy and 9. 32% in the second round compared with the first round;3) The amount of RMB deposition for urban and rural residents in Gannan Prefecture increased by 135. 36% in the first round and by 33. 76% in the second round compared with the first round. Based on the problems in the implementation of the compensation for grassland policy, the countermeasure suggestions were put forward including improving the standard of grazing ban subsidy and grass ‐ livestock balance reward,increasing the support for grassland supervision and law enforcement,and determining the grassland ban area and reasonable ban years by the county (city) government according to the degree of grassland degradation.