Evaluation of the function and health of grazed grassland is an important aspect of grazing ecology. Based on analyzing the physiological response of grassland to grazing, a double-factor method of physiological threshold was developed. Physiological low limit (PLL), physiological ultimate limit (PUL), and duration ratio of regrowth to grazing stage (R/G ratio) were feasible to evaluate the sustainable management on the function and health of grazed grasslands. The reasonable threshold values of PLL, PUL and R/G ratio could play an important role on the complete recovery of the function and health of grassland after grazing, which was the goal of sustainable management of grassland ecosystems.