The alpine meadow in the source region of the Yangtze and Yellow River is suffering serious deterioration. Though great efforts have been put into, the restoration for the degraded grassland is far from being effective, mainly due to poor understanding of the degradation mechanism of alpine meadow in this region. In order to clarify the formation mechanism of degradation grassland and provide the new ideas for restoration, degradation sequences of the alpine meadow in the source region of the Yangtze and Yellow River were taken as target systems to analyze the soil particle size distribution, the fractal dimension of the soil particle size, and the relationship between soil erosion modulus and fractal dimension. The results showed that, with increasing grassland degradation, the percentage contents of clay increased while the percentage contents of silt sand and very fine sand showed a decreasing trend. The fractal dimension presented a positive correlation with clay among the degradation sequences while negative correlations were found with very fine sand and silt sand. The curvilinear regression of fractal dimension and erosion modulus fitted a quadratic function. Judged by the function, fractal dimension 2.81 was the threshold value of soil erosion. The threshold value has an indicative meaning on predicting the breakout of grazing-induced erosion and on restoration of the degraded grassland. Taking fractal dimension of 2.81 as the restoration indicator, adoption of corresponding measures to make fractal dimension less than 2.81, would an effective way to restore the degradation grassland.