Forest fires threaten natural resources and human lives in many areas of the world. A rational assessment of forest fire risk is critical to reduce fire damage that threatens the sustainability of forest resources and their services. This is particularly true in Lijiang City, an important world heritage site. We assessed the grades of forest fire risk in Lijiang City based on the concept of a fire life cycle, using the probability of ignition in the pre-forest fire period, the capacity for detection and emergency rescue in the mid-forest fire period, and forest fire damage in the post-forest fire period. We used the analytical hierarchy process to analyse data on the ecology, economy, cultural resources, humanities and topography of Lijiang City, and geographic information systems (GIS) as a platform to integrate multi-source data. The results strongly agree with the records of reported forest fires between 2000 and 2011. This assessment method could be used in cities with large areas forestland that contains important resources and settlements, but without sufficient fire-fighting capacity to prevent and fight forest fires.