Grassland ecosystems play an important role in maintaining biodiversity, global carbon balance. Aiming at the desert steppe with an extremely fragile ecological environment, the spatiotemporal relation between vegetation fractional coverage (VFC) and climate was explored in this study in a pixel-scale analysis method. There was an overall increasing trend in the VFC of the study area. The coefficient of correlation between average precipitation from 2000 to 2013 and VFC was 0.81, and during the growing season, the coefficient of correlation between average temperature and VFC was −0.76. The two dominant factors of VFC in the study area, precipitation and temperature, were used as indicators to establish an ecological suitability index (ESI) for desert steppe to reflect the hydrothermal conditions for vegetation growth. The ESI of the study area varied from 0.03 to 0.94 with its average being 0.39, and the coefficient of correlation between ESI and VFC was 0.84. On the basis of ESI, an optimized layout adjustment was made for existing farmland in the study area so as to take advantage of natural conditions to the greatest extent and reduce impacts of human activities. The optimized layout of farmlands would adapt better to the natural climatic characteristics of the desert steppe regions, meanwhile, bring about ecological and environment benefits to the original agro–pastoral ecotone of the desert grasslands areas. Results from this study further our understanding of the desert steppe, and provide some reference for ecological restoration and new cycle of returning farmland to grassland policy.