Abstract: Using the survey data of the forest resources in Dianchi watershed of 2008,we estimated and calculated the ecological service function of forests in Dianchi watershed.Thetotal value of the forests in Dianchi watershed was 56.04×108 yuan/year,the value of the water and soil conservation werethe most considerable parts,the sum of thesetwo aspects accounted for 62.40 % of thetotal value,which implied the important role of forests in water and soil conservation of Dianchi watershed.Pinus yunnanensis and P.armandi werethe dominant species,61.1 % of thetotal stand area was occupied with thesetwo species.Castanopsis orthacantha and Cyclobalanopsis glaucoides with a promising function in the ecological service account for only 10.8 %.It was concluded that ecological service function and value of the forests in Dianchi watershed could be upgraded significantly through silvicultural activities.