Ecological restoration has been considered and implemented as a great way to reverse land degradation, particularly in vulnerable dryland areas. While there has been a large amount of research focusing on the ecological and economic benefits of ecological restoration projects, few studies have focused specifically on the intangible socio-cultural values like cultural heritage, identity, and social cohesion on these areas. The difficulty of quantification of those values is due to their subjective perception among individuals and keep changing social dynamics. Therefore, it remains unclear about how local inhabitants perceive the intangible cultural and social benefits provided by dryland ecosystem and how this perception impact community well-being. In the current study, we adopted cultural ecosystem services (CES) perspective and re-classify the commonly used 10 types of CES into 4 main categories, auto-responsive/intrinsic, behaviors, meanings and personal. We selected Yan’an, China as a case study, using semi structured household interviews to quantify perceptions of these CES. We used latent class analysis to classify the perception of CES into three types. The results show that all ten CES types were perceived by the rural communities in the drylands, and education and annual income have a significant effect on most CES types. In addition, many local landscapes and social activities also found to provide significant CES, due to close and highly social neighborhood relationships generated by local traditions in arid areas.