The suitability of natural environment for human settlements is assessed by human settlements environment index (HEI) at the grid scale in China. Population agglomeration and shrinking (PAS) is indicated by population density at the county level. Combining HEI and PAS, this paper established the sustainable human settlements functional division evaluation system and division model using GIS. Taking into consideration environmental carrying capacity and economic development levels and potentials, this work brings forward a feasible division scheme at the county level in China. The results show that: sustainable human settlements functions generally decrease from the southeast to the northwest, which reflects the most significant regional difference in China. Highly sustainable region, with a total area of 139.75×10⁴ km² and a population of 430.84 million, is mainly located in the southeastern coast of China, the middle and lower reaches of the Yangtze River, Sichuan Basin, Huanghe-Huaihe-Haihe Rivers Plain Region, and parts of the Northeast China Plain. Sanjiang Plain, Liaohe Plain, and Shandong Peninsula fall into moderately sustainable region, and the total area is 193.61×10⁴ km² and the population is 323.75 million. Generally sustainable region is mainly located in the Hulunbuir Plateau, Loess Plateau, and Yunnan-Guizhou Plateau, and sporadically distributed in valleys in southeast Tibet and Qaidam Basin, and it has an area of 210.19×10⁴ km² and a population of 369.25 million. Marginally sustainable region is scattered throughout the western part of China and mainly in the Loess Plateau, Sichuan-Yunnan Plateau, and Yunnan-Guizhou Plateau. It covers an area of 145.85×10⁴ km² , and 144.62 million people live in this region. Most parts of the Tibetan Plateau, deserts in the northwest, and northern Sichuan-Yunnan Plateau fall into the unsustainable region, which has a land area of 263.86×10⁴ km² and only 39.10 million people.