Two-way indicator species analysis (TWINSPAN) and canonical correspondence analysis (CCA) were employed to analyze the degradation characteristics, patterns, and processes of lakeside wetland in Napahai of northwest Yunnan Plateau. The plant communities in the lakeside wetland could be classified into four associations, according to the TWINSPAN results. The succession patterns of the plant community were represented by aquatic plant community --> swamp plant community --> swamp meadow plant community --> meadow plant community. During the processes of succession, the plant community coverage, density, Shannon diversity index, species richness, and plant aboveground biomass increased, whereas the community height decreased. The succession of the plant hydro-ecotypes followed the sequence of aquatic --> helophyte --> hygrophyte --> mesophyte. With the succession of the plant community, the wetland water quality indices salinity, alkalinity, and hardness decreased but ammonium nitrogen and total phosphorus concentrations increased, while total nitrogen and nitrate nitrogen concentrations showed no significant changes. Meanwhile, the soil pH and soil organic matter and total nitrogen contents decreased gradually, soil total phosphorous and potassium contents were increasing, whereas soil available phosphorous and potassium contents decreased after an initial increase. The CCA showed that the community species composition and structure were mainly affected by the wetland water gradient. The soil pH and total phosphorus content and the water total nitrogen and ammonium nitrogen concentrations had significant effects on the wetland plant species distribution and plant community succession.