A capability reporting method and a modem chip performing the same are provided. The capability reporting method includes the following steps. A capability enquiry message is received from a network. A plurality of weightings for a serving Radio Access Technology (RAT) and at least one non-serving RAT are determined. The weighting for the at least one non-serving RAT is downgraded. A plurality of capability information for the serving RAT and the non-serving RAT are composed according to the weightings. The size of the capability information for the at least one non-serving RAT is reduced. The capability information for the serving RAT and the capability information for the at least one non-serving RAT are combined to obtain a capability report message. The capability report message is replied to the network.