What changes have taken place in the livelihood of farmers and herdsmen in Tibetan areas of Sichuan? In the long run, what is the problem with the changed livelihood model? This paper found the answer based on a field survey of villages. The author found that in the research process, the new compound livelihood mode of villages, such as farmland leasing, large-scale animal husbandry and concentrated extraction of medicinal materials, was not sustainable, and the villagers’ destructive use of local resources without any technical processing accelerated the consumption of grassland and farmland resources, breaking the ecological balance maintained by the local traditional livelihood. When income from animal husbandry and medicinal materials collection is dominant, problems such as unstable market, sharp decrease of medicinal materials resources, reduced yield and quality of grassland will only lead to uncertainty and high risk of new compound livelihood model of villages, and even lead to poverty.