In the plant community with a shrub-grass mosaic, the main types of litter include herbaceous litter and its mixed forms with shrub leaves and stems. However, the quantitative relationship between the litter composition type and the litter decomposition, as well as how these processes are influenced by grazing activities (e.g., excrement deposition), remains largely unexplored.  Herein, a three-year litter incubation experiment was conducted in a shrub-encroached alpine meadow. We aimed to elucidate the individual and interactive effects of litter type (solely grass litter (L), a mixture of grass litter and shrub leaves (L1), and a mixture of grass litter, shrub leaves, and shrub stems (L2)) and yak excrement addition (no addition, addition of dung only, addition of urine only, addition of both dung and urine) on the litter decomposition rate and nutrients release. Additionally, the initial chemical quality of litter, soil microclimate, soil nutrients, and soil microbial attributes were analyzed to ascertain the underlying driving mechanisms.  We found that litter type and yak excrement had significant individual and interactive effects on litter decomposition. Specifically, litter type primarily affected litter decomposition by increasing initial carbon and lignin concentration and reducing the nitrogen and phosphorus concentration of the litter. In contrast, yak excrement positively impacted litter decomposition through enhancing soil pH and soil microbial activity. Crucially, low-quality litter (L2) mitigated the positive effects of yak excrement on litter decomposition. While the addition of yak excrement did not alter the overall direction of litter decomposition, it influenced the magnitude of the effects caused by litter mixing. Notably, temporary nitrogen immobilization was observed during the early stages of decomposition, and net phosphorus release patterns were evident throughout the decomposition process. However, the duration of nitrogen immobilization differed depending on the litter type and yak excrement treatment.  Our findings provide localized evidences that elucidates the interactive effects of litter type and yak excrement addition on litter decomposition and nutrient release processes. These results contribute to a deeper understanding of how grazing activity modulate nutrient cycling in shrub-encroached grassland ecosystems.