There is relatively little research on how management affects carbon storage and the carbon cycle in grasslands of China, and how this in turn affects regional development and natural capital conservation. Inner Mongolia has 25% of the total grassland area of China and about 60 million livestock. Productivity of the traditional grazing schemes in this area is very low; in addition frequent natural disasters greatly affect livestock production. The grasslands of northern China form a very important eco-economic community belt, thus we ask, “What is the future of this region and what will be its role in the carbon cycle under development pressure and the new conditions caused by climate change?” Using the emergy synthesis method, carbon models are constructed of the natural grasslands under different animal grazing pressures and increased atmospheric carbon dioxide concentrations and the ecological–economic benefits of several different grassland utilization schemes are compared using emergy evaluation. The result shows that in grazing scheme total C emission will be 4087kg/ha in one hundred years which supports the conclusion that over the long run grasslands can be a carbon source due to overgrazing. We estimate that the natural capital of these grasslands is around 13,303em$/ha and that is provides 106em$/ha/yr in ecosystem services. If 90% of the natural grassland can be reserved by using small-scale intensive grazing systems, we estimated these natural grasslands can provide 7.6billion em$/yr of ecosystem services and preserve 955billion em$ in natural capital, which is helpful information for proper policy making and in establishing a scientific strategy for sustainable development of the grasslands in north China, not only from the perspective of the indigenous nomadic culture, but also from an economic–ecological perspective.