Plant diversity was ecologically important for maintaining the stability of ecosystem functions, especially in fragile ecosystems. Understanding the dynamic relationship between understory herbaceous plant diversity and stability during vegetation succession and its environmental drivers is essential for effective ecosystem management. In this study, the dynamic relationship between diversity and stability of understorey herbaceous communities and its environmental regulation mechanism during the succession process of Caragana korshinskii sand-fixing forests at different stages of succession at the southern edge of the Mu Us Desert were systematically investigated by combining field investigation and laboratory analyses. The results showed that: with the succession (4a—44a), (1) Herbaceous communities cover and height exhibited significant increases (P<0.05). Species richness rose substantially, reaching 1.57 times the initial value observed in the earliest stage. Concurrently, both above-ground (AGB) and below-ground biomass (BGB) showed marked accumulation, achieving levels 3.45 times and 2.70 times greater, respectively, than those found at the onset of succession. (2) The Margalef index followed a distinct unimodal trajectory, peaking at the 28a succession stage (value: 0.41), while the Simpson index and Shannon-Wiener index displayed consistent overall increasing trends throughout the successional sequence. (3) The community stability and the Pielou index exhibited similar patterns of dynamic change, both showing an increase first and then stabilizing. Statistical analyses further elucidated key relationships: (4) Regression models established highly significant positive correlations between community stability and the Simpson index (P<0.001), Shannon-Wiener index (P<0.001), and Pielou index (P<0.001), which confirmed the intrinsic linkage between diversity components and stability. (5) Mantel tests identified critical environmental regulators, pinpointing soil physicochemical properties (specifically pH, total nitrogen content (TN), and the C/P stoichiometric ratio as significant drivers (P<0.05) shaping the diversity-stability relationship. (6) Redundancy Analysis (RDA) quantified the major environmental influences on herbaceous community structure and stability: Soil Water Content (SWC) emerged as the most influential factor, explaining a significant 34.0% (P<0.01) of the variation, followed closely by soil pH, which accounting for 27.2% (P<0.05) of the observed variance. This study verified the positive feedback mechanism of “time-diversity” in the process of ecosystem restoration in the arid zone, and provided empirical support for the theory of “biodiversity enhances ecosystem stability”. It was also clarified that the synergistic regulation of pH and moisture content was the core mechanism of herbaceous plant diversity and community stability in the understory. The results of this study provided an important scientific basis for the restoration and sustainable management of desert ecosystems.