There are few indicator systems available for monitoring and assessing the environmental quality of large-scale regions. We constructed an indicator system for integrated assessment of the environmental quality of the Dianchi Basin. First, the definition of regional environmental quality is determined by both the supply of materials and energy in the region and the extent to which the region is polluted. Second, the indicator categories used for assessment mainly comprise vegetation biomass and the concentrations of various pollutants. Third, owing to spatial heterogeneity of a region, evaluation of the regional environment first requires division into sub-regions, each of which should be relatively homogeneous with regard to physical conditions (e.g. marine and terrestrial) and appearance (e.g. vegetation cover). Finally, the mathematical models for assessing regional environmental quality can be built according to the relationships between the various indicators, the sub-regions and regional environmental quality. The indicator system built using this approach can reflect environmental changes over time and identifies reasons for environmental variation.