Xihu national nature protection area, the natural barrier of Dunhuang oasis, is located in the west of Hexi Corridor. Due to the climatic change and overdevelopment of land and water resources, the ecological environment problems such as wetland degradation and desertification have become more severe in the recent decades. The area of wetland, interpreted by multi-temporal remote sensing images, has decreased by 42.5%, from 17.2 thousands hm~2 to 9.9 thousands hm~2 from 1989 to 2013. The wetland evolution has a tendency of fragmentation, with its patch number increasing from 32 to 51 and the mean patch area declining from 537 hm~2 to 213 hm~2. The centroid of wetland moved southwest for about 11.59 km. It reveals that the wetland has a tendency of slowly moving to the southwest due to the development of Dunhuang city that located in the east of the wetland. The factor analysis is used to classify the driving factors related to wetland evaluation. Lastly, projection pursuit model is developed to analyze the influence of various driving factors on the wetland evaluation. The modeling result simultaneously illustrates that the wetland was in rapidly degenerated state during 23 years of the period between 1980 and 2013. The result also indicates that over-utilization of surface water and groundwater for agricultural land development is the radical reason of wetland degradation. The secondary motivation factors are glacier depletion and runoff decline caused by climatic change. In the 1990s, the wetland could keep a relatively steady state with the agricultural acreage remaining at 27 thousands hm~2. Therefore, it is suggested that the scale of land use should be kept at this level, or the use of surface water and groundwater should be reduced to the level in the early 1990s through the applications of saving water, changing crop type, as well as transferring water from nearby basins. The research results could provide considerable supports to wetland protection and the integrated riverbasin development planning and management.