Abstract Background The Zoige Plateau hosts the largest alpine peatland in the world, playing a crucial role in carbon sequestration and biodiversity conservation. However, this valuable ecosystem has been significantly impacted by anthropogenic drainage for various purposes, prompting increased interests in ecological restoration efforts. This study evaluates changes in plant diversity, community composition, and biomass allocation across natural, drained, and rewetted peatlands, with a particular focus on variations in microtopography, including hollows and hummocks. Results Restoration showed significantly higher soil water content, which was 11.6% higher in hollows (to 88.5 ± 0.09%) and 14.4% higher in hummocks (to 81.1 ± 1.6%) of rewetted peatlands compared to natural peatlands (p