Reviewing evolution of natural resources utilization mode in different economic formations, the paper elaborates the meanings of knowledge economy, and points out that the cause of unsustainable development is the acute contradiction between the law of ecosystem and the law of economy. It also points out that the essence of sustainable development is the harmonious relation between economy and the ecovstem. Therefore, the resources allocation should be considered from the aspect of the market demand and the aspect of the supply of the ecosystem. That is to say, firstly, the scale and pace of economy growth must be adapted to the supply capability of the ecosystem under the current technology. Secondly, based on the supply ability of the ecosystem, we should make it clear how to make limited resources allocation attains equilibrium between market supply and demand. The paper clarifies that in the mode of knowledge economy; we may transform the way of economy growth,form optimum economy structure, change the base of resource supply, strengthen the supply capability of ecosystem, expand the production-possibility frontier, and finally accomplish the eco-economy coordinated development through the innovation of institution and technology. The essence of sustainable development and the sustainable characteristics of knowledge economy that were discussed above determine that knowledge economy is an economy of sustainable development.