[Objective] By comparing the bacterial and fungal communities in alpine grassland soil and their degraded soil in Northwest Yunnan, we investigated the effect of vegetation degradation on microbial communities in alpine grassland soils.[Methods] Bacterial 16S rRNA genes and fungal ITS genes were chosen as the target genes. Quantitative PCR was performed to measure the gene copies to assess the abundance of microbial communities. Illumina Hiseq sequencing and bioinformatics analysis were carried out to determine microbial community composition and community structure.[Results] After grassland degradation, soil pH value was greatly increased by 0.65 units, and soil moisture, total organic carbon, dissolved nitrogen and C/N ratio were significantly decreased by 18.4%, 67.5%, 47.2% and 1.2%, respectively. Grassland degradation significantly reduced soil bacterial and fungal community abundances by 92.4% and 94.9%, respectively. Grassland degradation significantly altered the β-diversity of soil bacterial and fungal community, but had no effect on that of α-diversity. In addition, grassland degradation changed the species composition of soil bacterial and fungal communities at the OTU level, and the fungal OTUs changed largely. Grassland degradation had no effect on bacterial community composition at the phylum level, but changed the composition at the class level (such as Acidimicrobiia, Betaproteobacteria, Chloroplast etc.). No significant difference was detected in fungal community composition between grassland soils and degraded soils.[Conclusion] These findings suggested that the vegetation degradation in alpine grassland lead to a decline in soil quality and microbial abundance, and changes in microbial community structure.