Overgrazing is widely accepted to be the main driver of grassland degradation. However, policies designed to reduce overgrazing are poorly understood in terms of their political acceptability and their effectiveness in improving the sustainability of grassland management. This study was conducted to explore herders' preferences across a range of policies aimed at reducing stocking rates and how those policies impact on their stocking rate decisions. Choice Modelling and Contingent Behavior methods were used in a survey distributed to a sample of Inner Mongolian herders. It was found that while increasing the extent of loan payments and subsidies were popular amongst the herder respondents; these policy options are predicted to have no significant effect on stocking rates. In contrast, less preferred policies such as increasing the probability of being caught exceeding stocking rate limits and increasing the financial penalties associated with such breaches would be effective in reducing grazing pressure. Only the policy of increasing pension payments was shown to be both popular amongst respondents and effective in reducing stocking rates. The results from this research provide useful information to policy makers in their consideration of new policy initiatives.