Domestic satellites BJ-1, HJ and the most widely used satellite Landsat TM were selected to systematically compare their abilities and differences on the estimation of the biophysical parameters of grassland in sandstorm source region in Beijing and Tianjin, with the combination of field-measured fractional coverage, leaf area index and aboveground biomass data. The result shows: (1) In terms of the surface reflectance, HJ-1B and Landsat TM have a higher correlation with biophysical parameters in red band, compared with BJ-1, while BJ-1’s near infra-red band was obviously superior to HJ-1B and Landsat TM, (2) with respect to the vegetation indices, Landsat TM performed best, HJ-1B was the second, and BJ-1 was the worst, (3) compared with vegetation indices, multiple regression model can raise the estimation accuracy, BJ-1 based model improved significantly, while Landsat TM and HJ-1B based models were less obvious. Among them, the highest accuracy was acquired for leaf area index estimation through the BJ-1 based model (R2=0.61, RMSEP=0.15). In general, domestic satellites have their own unique features, which remain a huge potential to be further tapped.