In this study, we estimated grazing effect on biomass and net primary production (NPP) in a Mongolian grassland ecosystem (Kherlen Bayaan-Ulaan) using a new simulation model. It integrated Sim-CYCLE model and a defoliation model to analysis the productivity of the grassland ecosystem and defoliation effects by grazing livestock. Simulated results showed that increased stocking rates decreased below-ground biomass and NPP, increased allocation ratio of NPP to below-ground part, and decreased root turnover rate. These predictions show a satisfactory agreement with a set of field data obtained at Kherlen Bayaan-Ulaan.