The conservation of bryophyte diversity is of major importance, extending even to the bryophytes of degraded karst sinkholes. To demonstrate the effects of a degraded karst sinkhole environment on bryophyte diversity and vertical distribution, Guda Sinkhole, an extreme example of habitat degradation in Guizhou Province, China, was selected as the study area. Abundance index, α and β Diversity Index, floristic spectrum analysis, CCA and Generalized Linear Model were applied in this study. A total of 75 bryophyte species from 50 genera in 29 families were recorded in Guda Sinkhole, including 13 species endemic to China. Highest bryophyte diversity and abundance was recorded in the middle and upper sections of Guda Sinkhole; the lowest in the top section and the base. The rate of species replacement in the middle and upper sections was faster than in either the top section or at the base. There was a significant stratification of life-forms: The top section was dominated by turfs; the upper section by wefts; and mats were the dominant life-form of the middle section and the base. The bryophyte flora of Guda Sinkhole was dominated by North Temperate elements, East Asian elements and by species endemic to China. In vertical distribution, most bryophyte species had a point distribution, others a continuous distribution; all species endemic to China were point distributed. From the top to the base of the sink hole, bryophyte species were classified according to light intensity, temperature slope and depth humidity. Humidity was lowest at the top and increased toward the base. Bryophytes recorded at the top are species classified as xerophytes, those of the upper and middle sections classified as mixed xerophytes/hygrophytes, and those of the base as hygrophytes. When compared to natural sinkholes in good condition, this degraded sinkhole still provided refugia for Chinese endemic bryophyte species, even though continuing environmental damage to the environment threatened bryophyte diversity and distribution.