OK, now pay attention! This is Tibet, a country fighting to preserve its identity in the face of Chinese hostility. Our story is about a monk with a cunning plan to help: he would fund a Tibetan school by selling gourmet yak cheese to the West. It sounds inspired, but there was one big problem: the cheese was absolutely disgusting. And that's where this story really gets interesting ...

As a way to make some money out of Tibet, it seemed like a good idea at the time. Take one dynamic Tibetan monk in need of money for a good cause, several dozen yaks, the daughter of George Soros, and an American cheese-maker who shall remain nameless. Mix together slowly, ruminatively, creatively at 12,000 feet above sea level, strain the resulting gloop through muslin and export in bulk to the USA. Voilà! An unexpected wonder of the 21st century - gourmet yak cheese.

Only one thing turned out to be wrong when they opened the first crate in New York, and it was obvious from the first whiff: the stuff was inedible. With immense, intrepid labour, 300kg of yak cheese had been manufactured, packed, labelled and air freighted to America. Now they had to throw it away.

But despite the rank odour of the end result, the project that had produced it held much promise. The man behind it, Jigme Gyaltsen, a senior monk at the Ragya Buddhist monastery on the Qinghai Tibetan Plateau, had devoted years of effort to the challenge of teaching Tibetan children the culture and philosophy of Tibet, as well as maths, science, English and other subjects, in their own language.

From the outset, the challenge was a multiple one. The monastery sits at a bend of the mighty Yellow River, immersed in the rolling emerald-green grass of the Tibetan plateau, eight hours drive from the provincial capital, Xinin. Here, the herdsmen who roam the plateau with their yaks are not known for their learning: illiteracy among the women is 70 per cent. The nomadic nature of their lifestyles makes it difficult for their children to attend any school. Added to this, the Chinese authorities, who have ruled the province since the invasion of Tibet in 1961, are encouraging them to send their children away to state schools, where all the teaching is in Chinese. Put all this together and you begin to see why the local culture is dying out.

Schools in which Tibetan is a medium of instruction do still exist on the plateau, but they have been in decline for decades. Now more than ever, a Chinese education is seen as the passport to a government job and security. The task Jigme Gyaltsen faced was reviving a dying mode of learning, in a language under siege, creating a school from scratch, and then persuading the nomads to send their children.

It was the good fortune of Jigme (pronounced "Jimmy") that he met an American woman called Andrea Soros Colombel, daughter of the billionaire philosopher and philanthropist George Soros. Colombel's involvement with Tibetan affairs dates back to her first encounter with China in 1990 when she travelled all over the country. "A year later," she says, "I took a position as a volunteer English teacher in the northwest of China, in Qinghai province. I was fascinated by the places I visited and felt a great deal of respect for the people I met. Living and teaching on the Qinghai Tibetan plateau, I developed a strong affection for the unique beauty of the region and for the culture that has evolved there."

In 1993, following in George Soros's philanthropic footsteps, but on her own account, she set up an organisation called Trace Foundation to help Tibetans help themselves. Tibetan schools were one of Trace's main targets for funding from the outset. "Our work is not only politically but logistically very challenging," Colombel says. "I thought we could do things that other people are not in a position to do, that we could take on the complexity of working inside Tibet, which after all is where most Tibetans live. Not everybody can work in Tibet, and we can."

With financial support from Trace as well as from the Chinese authorities, Jigme's school got off the ground. A boarding school for boys a short distance from the Ragya monastery, it charged no fees to the nomadic parents, whose average per capita income is the equivalent of about £150 per year. "Jigme Gyaltsen offers the same curriculum as other schools, including those in Chinese medium," says Paola Vanzo, Trace Foundation's director of communications, "as well as exactly the same curriculum and text books. But he has a lot of supplementary educational material too." The school teaches both traditional and modern subjects, and takes pride in the fact that it is the only school in the Qinghai plateau to incorporate the teaching and debating methods used in Tibetan Buddhism for more than a millennium as a tool to study modern sciences.

The school, called the Jigme Gyaltsen Welfare School, was also the happy beneficiary of an organisation that can put in as much money as its president wishes, and keep putting it there as long as it likes, without reference to other potentially obstructive funding bodies upstream.

"We are not there for thousands of years, but for the long term, yes," says Colombel of Trace Foundation's work. "The way we operate is that we are there to support the people locally and have the contributions we make absorbed into the society. We like to work in a really collaborative way. It's a big challenge. We are always assessing the usefulness of our work, but by long term we mean decades."

Despite this generosity, however, Jigme found that his school's running costs were outstripping its means. The school continued to grow. New classrooms were built and a student kitchen, teacher trainers came from abroad, the library began to get larger ... and f the resulting costs continued inexorably to rise.

With Trace's encouragement, the monk began looking around for some way to make the school less dependent on outside sources of help. Attention quickly focused on the yak, referred to by Tibetans as the "treasure of the plateau". The enormous humped, horned bovine that can weigh upwards of 700kg provides nomadic Tibetans with practically all their daily necessities: the hides make shelter, the wool makes rope and clothes, the flesh is eaten, the dung provides the plateau's only local source of fuel. The female yak, which is correctly called a dri, provides milk that can be drunk fresh but which is also made into yoghurt and butter. The whey from the butter-making process is boiled and pressed to make chura, a traditional type of hard cheese.

None of these products offered much hope in terms of generating a steady income. But the attention of Jigme and his supporters kept returning to the milk of the dri: the only product of which Tibetans on the plateau enjoyed a steady surplus. Yet neither the milk nor the yoghurt were transportable, because they would not keep. And chura was very much a local taste.

Yet the dris' milk is powerful stuff: yaks graze on more than 60 different species of wildflowers and grasses, many of them fragrant, and the fragrant milk that results has twice the fat content of cows' milk. So the idea was born of building a cheese factory not too far from Jigme's school and monastery, getting the herdsmen to sell their surplus to it, turning the milk into a hard, European type of cheese, then selling it to the West. (Though China itself might appear a more obvious market, the Chinese have no tradition of eating dairy products.)

And so in 2001 a small cheese factory arose, one and a half hours by car from the Ragya monastery, strategically located at the junction of three magnificent valleys where the herders bring their animals for summer pasture. Even harder than building the factory was persuading the herdsmen that they could benefit from selling their surplus milk directly to the factory. "It took long summers of work on the plateau for Jigme Gyaltsen to convince the nomads that selling the milk directly to the cheese factory could dramatically increase their incomes," says Vanzo. The idea of marketing any of the yak's treasures was as exotic to the nomads as The Laughing Cow - because the available markets were simply too far away. "Almost none of the fresh products they make, such as yoghurt, milk or butter, could be transported in time even to the local market," says Paola, "which is a long horse ride away from where they live."

Slowly, however, the herdsmen were persuaded to consign their surplus to the white tiles and stainless steel of the new factory. And finally, in 2002, the first batch of Tibetan Plateau Yak Cheese was ready to hit the world's delicatessens - or in practice those of the US, because for trade-agreement reasons too tedious to go into (which Trace is now lobbying to change), the EU bans all agricultural imports from China. But, as described above, the cheese, the handiwork of an American expert brought up to the plateau to advise, proved inedible, and the whole enterprise seemed about to go down like the Hindenburg.

That couldn't be allowed to happen, however. So it was that in April 2004, Paola Vanzo found herself heading for the north-west Italian town of Bra with an air of determination and a lump of evil-smelling yak cheese in her bag.

She went to Bra because it is the world headquarters of the Slow Food Movement, founded 20 years ago by a local restaurant critic, Carlo Petrini. Slow Food began as a cry of rage by Italian gourmets against American fast food, making rapid inroads into Italian cities. But it quickly became far more than a protest movement: it became an expanding network of good-food lovers and producers, first in Italy and then, with a speed that belied the organisation's name, around the world. The showcase of the organisation was the annual Salone del Gusto, usually held in Turin, in the original Fiat car plant in the city, since converted into a trade hall. The first I attended was in 2002, and it was already an enormous affair, drawing champion cheese-makers from Britain, basmati rice growers from India, grits producers from the US, distillers and brewers and wine-makers from all over.

Slow Food was born with missionary intent, but always risks becoming little more than a vast assembly of foodies, happily gathered together for the world's healthiest pig-out. And for Italians, who are not puritanical, that is not an aspect to be shunned: the local groups of Slow Food enthusiasts are called "conviviums", and convivial is what they intend to be, as well as serious and worthy. But for Petrini the founder, bald, grey-bearded and rail-thin, Slow Food was always far more important than that: good food, he believes, is at risk of extermination everywhere, which is why the producers and the consumers must band together and fight to preserve it.

The most ambitious extension of the organisation's remit came in the same year that Vanzo took her yak cheese to Bra. Petrini announced the movement's first "Terra Madre" or "Mother Earth" event, in which thousands of the world's poorest farmers, fishermen and other food producers from every continent would be invited to Turin at the same time as the Salone del Gusto, to meet each other and to network, to discover ways of interacting and exchanging and to learn from each other how better to survive and prosper.

Vanzo's dilemma was exactly the sort of thing that Terra Madre was invented to confront. "Change is coming," says Colombel, referring to the herdsmen's life on the plateau. "Cultural shifts come with seeing new things. Of course, the grasslands and the high altitude will remain, but there could be pressure on herding and livestock management and it is not totally clear what the long-term logistic implications are. There is the possibility of more Tibetans becoming migrant labour, and the idea that things are not going to change on the grassland is a surface view."

The yak has been at the heart of the nomads' life for centuries. Yet given the pace of change in China, the herdsmen's culture could be swept away in a generation. The cheese factory was an alien intrusion, but one intended to raise the income and standard of living of the herdsmen while at the same time strengthening their roots in the plateau. It was just a pity about the cheese.

So in answer to Paola Vanzo's appeal, Slow Food acted fast. Vanzo met Piero Sardo - a founder member of the organisation and close associate of Petrini's - at Slow Food's headquarters. Petrini himself also became involved. Within weeks they had located three cheese-makers - two Italians and one Swiss master - willing to drop everything and head for the Himalayas. By July, they were up there in the grasslands with Vanzo, battling with the high-altitude headaches and tight breathing and working on a new cheese recipe.

As Vanzo explains, they had to work fast because the production season is so short. "Everyone knew that we could not afford to fail again," she says. The newly arrived experts checked every stage of the production process: they had doubts about the purity of the water source and uncovered a virgin spring at 5,000m to supply the factory with immaculate water. They rigorously tested the milk as it arrived from the fields, and made sure their Tibetan colleagues grasped the importance of testing every batch; they experimented with a different type of rennit, tinkered with other procedures, reduced the fat content of the finished product. The difference between a cheese that is sublime and one that is disgusting is not that great. The cheese masters made that difference.

Mere months later, another plane was loaded with crates of yak cheese, this time bearing the Slow Food stamp of approval and tasting much better. "It's like a rough pecorino," the Slow Food people say, "and like a pecorino, it improves with age, developing strong grassy scents tempered by the milk's natural richness."

"The shops in America took a lot of persuading," Vanzo recalls, "because they remembered the first batch, and said no thanks very much. But we told them it was something completely different and when they tasted it they realised it was true." Despite having the adverse reputation to combat, in 2004 Paola and colleagues shifted about 1,000 kilos of yak cheese in America, selling at around £20 per kg, a comparable price to Parmesan. Last year, that figure went up to 1,500kg.

"This year we are hoping to produce and export three tonnes," Paola says. But even if they succeed they will still be a long way off target. "Originally we thought that production of four tonnes of cheese would be enough to support the school," she continues. "But the school keeps growing with more and more students - 580 now - so now we calculate we need to produce 10 tonnes to support it without external funding. This income would cover teachers' salaries, food for the canteen, bedding and fuel for the dormitories (yak dung for the stoves) and educational materials."

What it won't begin to cover is the cost of the girls' school, now up and running, that Jigme Gyaltsen has built at a distance from the boys' one. Or the cost of restoring the monastery - much of it destroyed in the Cultural Revolution - to its original beauty; built with the help of craftsmen from Lhasa, this also owed nothing to yak cheese and everything to the deep pockets of foreign friends. Nobody would claim that giving Tibetans the wherewithal to survive the cultural, political and economic onslaughts they face was ever going to be easy, or cheap. But Jigme, Andrea, Paola and friends have made an awesome start. For more information, see www.tibetcheese.org