Desertification in degraded grasslands is manifested through the development of bare sandy patches, which eventually lead to habitat fragmentation. The ability of these bare sandy patches to regenerate naturally through in-situ soil seed banks is not well understood. To fill this knowledge gap, we randomly selected 24 bare sandy patches with areas ranging from 19 to 898 m² in a desertified grassland of the Horqin sandy land, Northern China to determine whether soil seed bank can be used for natural regeneration of bare sandy patches. Species composition and density of soil seed bank as well as aboveground vegetation composition, abundance and coverage were investigated. We then determined their relationships with in-situ habitat characteristics. Our observations showed that the studied area had low soil seed bank density and species richness, as well as depauperate soil seed bank communities. Consequently, local soil seed bank was not able to provide sufficient seed source for natural regeneration. This was indicated by the relationships between aboveground vegetation, soil seed bank and the in-situ habitat characteristics. For bare patches with an area between 300 m² and 900 m², increase the soil seed bank density and species richness should be the main restoration measures. For bare patches with a small area of less than 50 m², restoration of vegetation density should be the main measure. Our data highlighted that different extents of desertification, indicated by different bare patches, are requiring distinct restoration measures.