This paper calculates the international competitiveness of Chinese cashmere industry by using revealed comparative advantage index, world trade competitiveness index, and market share, and further analyses its influence factors. The results show that, raw cashmere output has absolute advantage but doesn't have international competitiveness; dehaired cashmere has strong international competitiveness but tends to decrease in recent years; cashmere sweater always has very strong international competitiveness. Cost and price, production factors, production capacity, brand and marketing, industrial concentration, market demand, and government supporting policies are the factors which effect the international competitiveness of Chinese cashmere industry. At last, this paper proposes related policy recommendations to promote the enhancement of international competitiveness of Chinese cashmere industry, which include strengthening grassland ecological environment instruction, speeding up feed industry development, strengthening breed cultivation and technology research and development, regulating market order, adjusting and improving industry structure, fostering consumer demand and strengthening government support.