Grassland fragmentation driven by anthropogenic activities poses a major threat to biodiversity in arid ecosystems and has profound consequences for grassland locust community dynamics. As both ecological indicators and potential agricultural pests, understanding how grassland locust communities respond to fragmentation is essential for biodiversity conservation and pest management. However, most previous studies have focused on taxonomic diversity alone, while how habitat fragmentation simultaneously affects taxonomic diversity, functional traits, and functional diversity of grassland locusts, particularly in arid desert steppe ecosystems, remains poorly understood. Here, we investigated the taxonomic diversity, functional traits, and functional diversity of grassland locusts along a fragmentation gradient comprising five levels, from low (Level I) to high (Level V), in the Ningxia desert steppe. We quantified grassland locust alpha- and beta-diversity, measured key morphological traits related to mobility and resource use, and calculated functional diversity indices. Environmental drivers, including vegetation structure and soil properties, were assessed for their influence on grassland locust communities using Mantel tests. Our results indicate that grassland locust species abundance increased with fragmentation, with the highest values observed in fragmentation levels IV and V. beta-diversity was primarily driven by species turnover rather than richness differences, indicating that habitat fragmentation mainly altered species replacement among sites. Functional traits related to body size generally decreased with fragmentation, whereas traits associated with dispersal and locomotion exhibited significant adaptive responses. Functional diversity indices, particularly functional dispersion and Rao's quadratic entropy, were highest at the most fragmented sites, indicating increased niche differentiation and resource partitioning under high fragmentation. Mantel tests indicated that soil pH and vegetation abundance significantly shaped grassland locust community composition, with strong coupling between soil properties and vegetation diversity under grassland fragmentation. Overall, our findings demonstrate that grassland fragmentation reshapes both taxonomic and functional dimensions of grassland locust communities, with important implications for grassland management and outbreak prediction in arid ecosystems.