Abstract: The causes and mechanisms of shrub invasion in natural grassland, and the impact on soil resource (soil moisture and available nutrients) heterogeneity caused by shrub invasion of natural grassland are reviewed as are biogeochemical ecosystem processes and the relationship between soil heterogeneity and land degradation in semi-arid areas. Periodic drought and human activity are the two main factors promoting shrub invasion in semiarid areas. Temporal and spatial heterogeneity of soil resources increased with shrub invasion: as soil moisture and available nutrients accumulate under the shrub canopy forming an ‘island of fertility’. Both physical and biological factors show increasing heterogeneity with shrub establishment. Temporal and spatial heterogeneity of soil resources at the patch scale contribute to the initiation of soil erosion and consequent land degradation. Grass and shrub patch mosaic landscapes have low stability and have the highest likelihood of future land degradation. Hence, shrub invasion and shrub density in communities in natural grassland in semi-arid areas should be controlled to prevent soil erosion. Multi-scale analysis of the causes of soil resource heterogeneity in ecosystem are helpful in revealing the mechanisms of land degradation in semi-arid areas.