The aim of this study was to clarify the patterns of soil phosphorus transformation and factors driving this process during alpine wetland degradation. Such information is useful for devising strategies to manage nutrient and carbon “sinks” in the ecological restoration of wetlands. Four types of marsh wetlands in Zoige Nature Reserve, including relatively pristine marsh (RPM), lightly degraded marsh (LDM), moderately degraded marsh (MDM), and heavily degraded marsh (HDM), were selected to investigate the evolution of phosphorus forms in soil, and factors affecting this process. Analyses were conducted using 31P nuclear magnetic resonance and a piecewise structural equation model. It was found that the degradation of alpine wetland led to a succession of plant communities from hygrophytes to mesophytes, and reductions in the soil organic matter and nitrogen contents. The contents of orthophosphate and phosphate monoesters displayed a parabolic trend with the maximum occurring in MDM along the gradient of marsh degradation. The orthophosphate content was 46.45% lower in HDM than in RPM. The phosphate monoesters content was 27.02%, 54.96%, and 41.74% higher in LDM, MDM, and HDM than in RPM, respectively. The contents of pyrophosphate and phosphate diesters continuously decreased with increasing severity of wetland degradation. The piecewise structural equation model indicated that microbial activity was a positive factor influencing soil orthophosphates, pyrophosphates, and phosphate diesters, and a negative factor influencing phosphate monoesters. Vegetation biomass was a positive factor influencing soil orthophosphates and phosphate diesters. Soil nutrients indirectly affected pyrophosphates and phosphate diesters by impacting microbial activity. Overall, wetland degradation promoted the decomposition of phosphate diesters by changing the vegetation community and decreasing soil nutrient availability and microbial activity. Soil phosphorus availability decreased in HDM because of the decline in the phosphate monoester mineralization rate and decreased orthophosphate content.