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Land degradation in Inner Mongolia, China is much severe. Remote sensing application on land degradation assessment can provide scientific basis for land degradation prevention in the study area. In this paper, land degradation was assessed by applying two improved relative Rain Use Efficiency (RUE) indicators based on time series MODIS NDVI data and high-resolution meteorological data from 2001 to 2010. The results show that 76.74% land of the whole study area with good or unusually good condition, it indicates that the most areas have normal or good vegetation production capacity. The unusually degraded and degraded lands account for 11.94% of the study area, especially they are less degraded lands distributing in Beijing and Tianjin sandstorm source region within the Inner Mongolia, it indicates that some ecological engineering projects implemented in this area have achieved significantly for restoration of degraded ecosystems in recent 10 years.