Compared with their fellow citizens in the city, rural residents are more likely to be affected by ecological restoration programs and policies. Yet no one has conducted a large-scale study of how ecological conservation impacts rural livelihoods and the economic status of rural households, especially in China. To fill that knowledge gap, I collected and analyzed relevant data from 2007 to 2018 for western and eastern China. I found that the relationship between western China’s green coverage rate and rural income followed an inverted U curve whereas that between its green coverage rate and urban-rural income gap was instead U-shaped, suggesting that ecological restoration has come to eventually negatively impact the economic welfare of rural residents in western China; however, the complete opposite was found in eastern China. Greater urbanization, financial support, and infrastructure such as education, medical, and Internet services would help to improve the current situation in western China. This suggests the government should take actions—such as improving the quality of farmer training to the rural residents and improving infrastructure construction—to help farmers acquire a new source of income and narrow the urban-rural income gap in parallel to implementing ecological restoration projects.