Environmental degeneration in the Tibetan Plateau attracts worldwide attention, whereas case studies on how the residents understand and respond to environmental degeneration are scarce. Using a Participatory Rural Appraisal method, this paper investigates how the people in different regions in the upper Dadu River understand and respond to environmental degeneration, based on comparative field surveys in three villages, in which Danzamu village is chosen from villages in the valley region, Kerma village from mountainside region, Rico village from the mountain and plateau region. The results show that: (1) although awakened to environmental degeneration, the residents in different regions have different responses. As agricultural labors have been transferred to the secondary and tertiary industries,population pressure in Danzamu and Kerma villages is mitigated. Residents in Danzamu village actively respond to natural disasters and forest degradation, as their livelihoods never rely on forests and rangelands again. Whereas the residents in Kerma village negatively respond to natural disasters, forest and meadow degradation and the ruin of wildlife resources, as their livelihoods still rely on stockbreeding.Labors in Rico village are hard to transfer to the secondary and tertiary industries, so they have to raise more livestock to make a living. Active measures are just taken to avoid livestock loss, not to avoid forest and meadow degradation and the ruin of wildlife resources. So the most fragile region is the mountain and plateau region and mountainside region, not the valley region. (2) Livelihood strategy is the key factor affecting the residents to respond to population pressure and environmental degeneration. So the framework of sustainable livelihood strategy should be used to explain and intervene in issues of population pressure and environmental degradation in ecotones. (3) Transferring agricultural labors to the secondary and tertiary industries were favorable to improving peoples livelihood. It is necessary to reduce the education fees to speed up the pace of labors transferring in the mountainside region. In the mountain and plateau region, preferable ways also include the development of towns, highways,education equipment and other establishments.