We report on entanglement-based quantum key distribution between a low-Earth-orbit satellite equipped with a space borne entangled-photon source and a ground observatory. One of the entangled photons is measured locally at the satellite, and the other one is sent via a down link to the receiver in the Delingha ground station. The link attenuation is measured to vary from 29 dB at 530 km to 36 dB at 1000 km. We observe that the two-photon entanglement survives after being distributed between the satellite and the ground, with a measured state fidelity of ≥0.86. We then perform the entanglement-based quantum key distribution protocol and obtain an average final key rate of 3.5 bits/s at the distance range of 530-1000 km.