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We explored the ecological effects of grassland restoration programs using satellite imagery and field plots sampling data and analyzing the patterns and mechanisms of land cover change and vegetation activities in arid and semiarid China during the period from 1982 to 2008. The grassland cover in the 1980s, 2000 and 2005 was compared before and after the restoration programs. The variability of net primary production (NPP) and rain use efficiency (RUE) were analyzed as indicators of vegetation productivity. Our study showed that changes in grassland cover were closely related to the relative area of farmland, with increases in grassland being caused by returning farmland to grassland and decreases being caused by reclamation for agriculture. The results of NPP and RUE measurements over the past 30 years showed systematic increases in the area of grassland in most regions, especially from 2000 to 2008. This fact was reflected by intensified vegetation activity and cannot be completely explained by the warmer and wetter climate, which suggested a contribution from restored, ungrazed grasslands. Our analysis indicates that both vegetation activity and grassland cover increased in regions in which grassland and rangeland restoration programs were implemented.