Grassland is the second largest terrestrial ecosystem in China and provides a large variety of ecosystem services to human beings. However, its economic value and the associated realization mechanisms still require in-depth research. Compiling the current literature and using meta-analysis, this study systematically evaluates the economic value of grassland ecosystem services and its temporal and spatial variation in China and worldwide. Moreover, rigorous empirical analysis are conducted on the economic value of three typical ecosystem services. The results show that the economic value of global grassland ecosystem services equals to 21.9 trillion USD (constant price in 2020), equivalent to 16.4% of global GDP in 2020. The economic value of grassland ecosystem services in China is as high as 6.22 trillion CNY (equivalent to 6.13% of GDP or 80% of agricultural GDP of China in 2020), mostly provided in Tibet, Inner Mongolia, Xinjiang, and Qinghai. Among them, 84% comes from ecological regulation services. These economic values also increase as the economy develops. The empirical analysis of typical ecosystem services show that the potential economic value of grassland eco-products, eco-tourism, and wind-break and sand-fixation are higher than those reported in the current literature. However, realizing these economic values provided by grassland ecosystem faces many challenges. Furthermore, this study provides policy implications on the development strategies, key engineering projects, and policy measures to improve and realize the economic value of grassland ecosystem services in China.