Abstract:The ecological compensation principle is designed to enhance the input of ecological protection interests in economic development and to counterbalance the ecological impacts of such developments when implemented. In this article,we evaluated the ecological compensation mechanism for regional farmland protection using exchange of farmland in two typical regions in China, Jiangyin (with less arable land resource) and Xinghua (with much arable land resource).First, from a perspective of regional land use, three major eco-environmental impact indexes, land use structure, distribution of natural resources, and soil conditions, were used to calculate the impact on ecological environment of economic compensation by exchange of farmland. Second, based on the collected data of carbon dioxide fixation, oxygen release, soil quality maintaining and water conservation, ecosystem services value was quantified. The authors conclude that, from the year 2010 to 2015, the ecological value in Jiangyin and Xinghua will continuce to increase. The economic compensation value will increase from 244008.10 to 245871.37 yuan per hectare. This value should be paid to Jiangyin City (the supplier of farmland protection task) by Xinghua City (the receiver of farmland protection task).