According to survey, the theoretic livestock carrying capacity of Qinghai grassland is 1608.08 ×10^4 sheep units, including 1282.84 ×10^4 sheep units of natural grassland, 224.78 ×10^4 sheep units of artificial grassland, and 104.45 ×10^4 sheep units of crop straw, accounting for 79.77% ,13.73% ,and 6.50% of total theoretic livestock capacity, respectively. Comparing with the actual livestock population (3020.05 ×10^4 sheep units) in 2009, there were 1411.97 ×10^4 overgrazing sheep units, with an overgrazing rate of 87.81% and grassland livestock carrying pressure index of 1.88, which suggests a state of severe overgrazing. Based on the carrying capacity and balance analysis result, the 19 pastoral counties of Qinghai should decrease their livestock population by 1183.26 ×10^4 sheep units, with a 60.71% of decrease rate.