Following the India-Eurasian collision, widespread mountain building has occurred in and around the Tibetan Plateau, and further influenced the regional climate. The tectonic activity and climate changes significantly affect the evolution of drainage basins. The Yellow River originates from the central Tibetan Plateau and flows through the northeastern margin of the plateau. Although the tectonic and surface processes in the Yellow River headwater area have been extensively studied, the drainage evolution in this region and its controlling mechanisms remain controversial. Drainage divides, which serve as the boundaries of drainage basins, can migrate for tens of millions of years after a tectonic and/or climatic disturbance. Therefore, drainage-divide stability can provide new and independent constraints on drainage evolution. In this study, we assess the stability of the drainage divide surrounding the Yellow River headwater area using two methods, chi-plot and Gilbert metrics. The result shows that the Yellow River headwater is shrinking as surrounding rivers encroach upon it. Based on the drainage-divide stability analysis, numerical simulation, and previous research, we suggest that both tectonic activity and climate changes have profoundly influenced the drainage evolution in the Yellow River headwater area. The shrinkage of the Yellow River headwater is mainly driven by the northeastward expansion of the Tibetan Plateau in the Late Cenozoic. Meanwhile, the Yellow River headwater area has become increasingly flattening, which creates conditions for sedimentation and periodic disintegration and re-integration events driven by cyclical climate changes (e.g., glacial cycles).