Vegetation condition after implementation of the returning farmland to forest/grassland project in Huining County of Gansu Province was analyzed based on the analysis of MODIS NDVI data and field investigation in the study area. The vegetation conditions have been improved in recent years, with four facts as below:(1) Vegetation coverage has increased significantly due to the implementation of the project, closing hillsides for livestock grazing and other measures, and the area for increased NDVI index was 4404.75 km² in 2011 in comparison with the year of 2000, accounting for 77.74% of the total area of Huining County. (2) Vegetation type showed a stable and increasing tendency in the region after implementation of the project. (3) Soil erosion has been curbed, and the number of mountain torrents obviously decreased from 2000 to 2011, with the corresponding decline of discharge and destructive power. The average value for mountain torrents was 3 times for 50 drainage ditches in 2011, which declined by nearly half as compared with the case before the implementation of the project. (4) The majority of farmers have approved of soil and water conservation benefits after implementation of the project, and their economic income also showed an increasing trend.