Understanding the ecological impacts of livestock grazing on rangeland conditions is essential for developing sustainable rangeland management strategies that balance livestock production and ecosystem health. However, there is a paucity of field experiments measuring the impacts of grazing on rangeland health in the Himalayan region. This study assessed the impacts of four grazing intensities—non-grazed (NG), lightly grazed (LG), moderately grazed (MG), and highly grazed (HG)—on plant species diversity, community composition, plant height, biomass production, and soil physicochemical properties across three sub-alpine rangelands in Jumla district, western Nepal. A total of 113 plant species were recorded, dominated by forbs (87.6%), with fewer graminoids, pteridophytes, and shrubs. Species richness increased along the grazing gradient from HG to NG, with MG plots supporting high diversity and productivity. Non-metric multidimensional scaling (NMDS) ordination revealed distinct species assemblages under NG, while MG and LG showed overlapping plant communities. Plant height and biomass were the highest in NG plots and declined with increased grazing intensity, with elevation exerting a negative effect on both. Soil organic carbon and nitrogen were generally higher under NG and MG, although responses varied across sites. Our results support the intermediate disturbance hypothesis and highlight the ecological benefits of moderate grazing, although these effects are largely site-specific. The complex interaction between grazing pressure and environmental conditions underscores the importance of site-specific and adaptive management strategies to sustain rangeland health. Our findings provide valuable evidence for designing evidence-based sustainable rangeland management strategies in Nepal and comparable high-altitude regions.