Assessing vegetation changes in alpine arid and fragile ecosystems is imperative for informed ecological restoration initiatives and adaptive ecosystem management. Previous studies primarily employed the Normalized Difference Vegetation Index (NDVI) to reveal vegetation dynamics, ignoring the spatial heterogeneity alterations caused by bare soil. In this study, we used a comprehensive analysis of NDVI and its spatial heterogeneity to examine the vegetation changes across the Three-River Headwaters Region (TRHR) over the past two decades. A random forest model was used to elucidate the underlying causes of these changes. We found that between 2000 and 2022, 9.4% of the regions exhibited significant changes in both NDVI and its spatial heterogeneity. These regions were categorized into six distinct types of vegetation change: improving conditions (62.1%), regrowing conditions (11.0%), slight degradation (16.2%), medium degradation (8.4%), severe degradation (2.0%), and desertification (0.3%). In comparison with steppe regions, meadows showed a greater proportion of improved conditions and medium degradation, whereas steppes had more instances of regrowth and slight degradation. Climate variables are the dominant factors that caused vegetation changes, with contributions to NDVI and spatial heterogeneity reaching 68.9% and 73.2%, respectively. Temperature is the primary driver of vegetation dynamics across the different types of change, with a more pronounced impact in meadows. In severely degraded steppe and meadow regions, grazing intensity emerged as the predominant driver of NDVI change, with an importance value exceeding 0.50. Notably, as degradation progressed from slight to severe, the significance of this factor correspondingly increased. Our findings can provide effective information for guiding the implementation of ecological restoration projects and the sustainable management of alpine arid ecosystems.