Land use/cover change (LUCC) is a dominant driver of ecosystem service dynamics in arid inland basins. Focusing on the Yarkant River Basin (YRB), Xinjiang, we coupled the PLUS land-use simulation with the InVEST Habitat Quality Model to project 2040 land-use patterns under four policy scenarios-Natural Development (ND), Arable Protection (AP), Ecological Protection (EP), and Economic Development (ED)-and to quantify their impact on habitat quality. Model validation against the 2020 map indicated strong agreement (Kappa = 0.792; FOM = 0.342), supporting scenario inference. From 1990 to 2023, arable land expanded by 58.17% and construction land by 121.64%, while forest land declined by 37.45%; these shifts corresponded to a basin-wide decline and increasing spatial heterogeneity of habitat quality. Scenario comparisons showed the EP pathway performed best, with 32.11% of the basin classified as very high-quality habitat and only 8.36% as very low-quality. In contrast, under ED, the combined share of very low + low quality reached 11.17%, alongside greater fragmentation. Spatially, high-quality habitat concentrates in forest and grassland zones of the middle-upper basin, whereas low-quality areas cluster along the oasis-desert transition and urban peripheries. Expansion of arable and construction land emerges as the primary driver of degradation. These results underscore the need to prioritize ecological-protection strategies especially improving habitat quality in oasis regions and strengthening landscape connectivity to support spatial planning and ecological security in dryland inland river basins.