Owing to overexploitation, wild resources of Astragalus mongolica, a Chinese herbal plant that is widely distributed in the arid and semi-arid areas of Northern China, have gradually become exhausted, and therefore, commercial cultivation is increasingly important to meet the growing demand for astragalus and reduce the pressure on wild populations. Nitrogen level is an important factor that affects the yield and quality of A. mongolica. However, uniform standards for fertilization among production areas have not yet been determined. In this study, the effect of nitrogen fertilizer treatment on the yield and quality of A. mongolica in the Qinghai-Tibet Plateau was explored using a control treatment (no added nitrogen, N0) and five different nutrient levels: 37.5 kg/ha (N1), 75 kg/ha (N2), 112.5 kg/ha (N3), 150 kg/ha (N4), and 187.5 kg/ha (N5). According to grey relational analysis, the optimal nitrogen fertilizer treatment was the N4 level followed by the N5 and N2 levels. Nitrogen fertilizer significantly increased the root biomass, plant height, root length, and root diameter. However, nitrogen fertilization had no significant effect on the content of Astragaloside IV and mullein isoflavone glucoside. The content of ononin and calycosin continually accumulated throughout the growing period. The results showed that the ononin and calycosin content under N4 and N2 is higher than other levels and there is not significantly different between different nitrogen fertilizer levels about them. The content of formononetin decreased gradually with the progression of the growing season. The optimal nitrogen fertilizer treatment for A. mongolica is recommended to be 150 kg/ha and the content of active compounds and yield were observed to reach the maximum in October.