<p>Relying on a Quasi-natural experiment of ecological resettlement in the western pastoral areas in 2004 and retrospective data across an extended period, this paper explores the long-term impacts of ecological resettlement on the incomes of herder households in western pastoral areas of China. We find that ecological resettlement increased herder household incomes from the long-term. The positive impact of ecological resettlement on herder households’ incomes has been greater for households with male heads and for larger households and those with larger pastureland areas. Ecological resettlement mainly realizes the increase of household income by increasing cordyceps income and subsidy income. Ecological resettlement increases the living and health care expenses of herder households, which in turn leads to a significant increase in the probability of loans being taken and, in the amount, borrowed. Cordyceps income and subsidy income are the main sources of income from which resettled herder households repay loans.</p>