Grassland is among the largest terrestrial biomes and is experiencing serious degradation, especially on the Qinghai-Tibet Plateau (QTP). However, the influences of grassland degradation on microbial communities in stream biofilms are largely unknown. Using 16S rRNA gene sequencing, we investigated the bacterial communities in stream biofilms in sub-basins with different grassland status in the Qinghai Lake watershed. Grassland status in the sub-basins was quantified using the normalized difference vegetation index (NDVI). Proteobacteria, Bacteroidetes, Cyanobacteria, and Verrucomicrobia were the dominant bacterial phyla. OTUs, 7,050, were detected in total, within which 19 were abundant taxa, and 6,922 were rare taxa. Chao 1, the number of observed OTUs, and phylogenetic diversity had positive correlations with carbon (C), nitrogen (N), and/or phosphorus (P) in biofilms per se. The variation of bacterial communities in stream biofilms was closely associated with the rate of change in NDVI, pH, conductivity, as well as C, N, P, contents and C:N ratio of the biofilms. Abundant subcommunities were more influenced by environmental variables relative to the whole community and to rare subcommunities. These results suggest that the history of grassland degradation (indicated as the rate of change in NDVI) influences bacterial communities in stream biofilms. Moreover, the bacterial community network showed high modularity with five major modules (>50 nodes) that responded differently to environmental variables. According to the module structure, only one module connector and 12 module hubs were identified, suggesting high fragmentation of the network and considerable independence of the modules. Most of the keystone taxa were rare taxa, consistent with fragmentation of the network and with adverse consequences for bacterial community integrity and function in the biofilms. By documenting the properties of bacterial communities in stream biofilms in a degrading grassland watershed, our study adds to our knowledge of the potential influences of grassland degradation on aquatic ecosystems.