The fluctuation of vegetation water condition around desert area is one of most important parameters to interpret the desertification expansion. United Nations reported that about 35 million square kilometers of land are subject to desertification. Historically, many parts of China have been suffered from severe desertification. This paper attempts an analysis for spatio-temporal variation characteristics of vegetation drought status around China and Mongolia desert with remotely sensed data. Time series images (1 January, 1999 - 31 December 2006) obtained from SPOT/VEGETATION were used to monitor inter-annual variability of water condition. SPOT/VEGETATION satellite, which has a fine temporal resolution and sensitive to vegetation growth, could be very useful to detect large scale dynamics of environmental changes and desertification progress. The main objective of the study is analyzing water status around China and Mongolia desert and predicting a risk area of desertification. In this study, NDWI (Normalized Difference Water Index) is used to monitor vegetation water condition (drought status) over the study area. To interpret the relationship between vegetation drought status and vigor, NDVI (Normalized Difference Vegetation Index) was employed in ensemble with NDWI. Annual total precipitation from NCEP/NCAR reanalysis data is used as subsidiary data. The study area from 73°36´E to 120°41´E longitude and from 30°81´N to 52°13´N longitude in northern China and whole Mongolia. NDWI value around desert has a range from -0.05 to -0.35 and NDWI values are decreased during the study period. Each year precipitation patterns are similar to yearly mean NDWI value. The study detected several areas where NDWI is dramatically decreased for 8 years, especially northeast part of Mongolian Gobi desert and southeast part of China Taklamakan desert.