With soil-resin-core equipment, correlation between sheep manure application and nitrate leaching amount under grassland-farming system in three gorges region was studied. Results showed that there had nitrate accumulation of organic fertilizer in soil. Nitrate accumulation and total soil nitrogen content increased with increasing manure application. Nitrate content in soil changed seasonally because of changing precipitation, temperature and grass growth and highest content was found in January. Total soil nitrogen content and nitrate content significantly influenced nitrate leaching amount from 20 cm depth soil, they had significant positive correlation. Manure application significantly increased grass yields while surplus application decreased yields and increased nitrate leaching possibility. Under certain grass yields, carrying capacity of sheep manure by pasture was higher than the manure produced from sheep breed on certain area of pasture. With manure returned to pasture, it is feasible to develop confinement rearing in three gorges region based on resources and environment.