[Objective] The effect of two site preparation methods was analyzed on plant community characteristics of grassland in order to provide scientific basis for vegetation restoration and construction in the semiarid loess hilly region of Southern Ningxia region.[Methods] By investigating the fixed sample plots and communities data, we compared the community dynamic characteristics effected by site preparation methods of "88542" level trench and fish-scale pits.[Results] (1) In temporal scale, the heterogeneity of habitat greatly affected the plant community structures in fish-scale pit site preparing mode. Site preparing mode had a little effect on the characteristics of plant community structure. (2) The difference of habitat environmental affected species diversity. Fish-scale pit site preparing mode led to higher heterogeneity of habitat environment, thus improving diversity. The order of species diversity among three sampling plots was fish-scale pit site preparing > "88542" level furrow site preparing > natural closed steppe. (3) The community diversity of the demonstration area was declining with time.[Conclusion] Different artificial disturbance and different habitat environment had important effect on plant diversity.