The Taihu Lake basin is a critical ecological protection area in China. Understanding the evolutionary process of land use and the Ecosystem Service Values (ESVs) of the Taihu Lake basin is an important prerequisite for promoting its sustainable development. The land use change patterns in the Taihu Lake basin based on data from 2005, 2010, 2015, and 2022, using land use transition matrices and land dynamic index. Use of the land use classification precision of Kappa coefficient test improves the equivalent factor method for calculating ecosystem services value. The result demonstrated that: (1) the Kappa coefficient of 0.932; From 2005 to 2022, land use in the Taihu Lake basin underwent significant changes, with the most prominent conversion from plowland to construction land. The increase in water and forestland areas led to an 8.31% increase in total ESVs. (2) ESVs increased by $1.181 billion over the past 17 years. Land use types such as water bodies, grasslands, and forestlands accounted for 92.16% of the total ESVs. Key ecosystem services in the region, including hydrological regulation, water resource supply, climate regulation, and environment cleaning, together contributed 83.61% of the total ESVs; (3) the ESVs are relatively insensitive to changes in coefficient values. Currently, the primary challenge of ESVs is from plowland degradation. In the lower reaches, regulatory services should be strengthened, provided that vegetation protection is maintained. Research on land use evolution analysis in the Taihu Lake basin can provide valuable references for environmental protection and urban and rural development.