Urbanization in China
Urbanization in the People's Republic of China increased in speed following the initiation of the reform and opening up policy. According to the Chinese government, the country's urbanization rate was 67 percent at end of 2024. According to the United Nations, the country's urbanization rate was 83.7 percent in 2025, having peaked in absolute numbers in 2021.
History
Before industrialization
China's increase in urbanization was one of the several functions of the surpluses produced from the agricultural sectors in China. This judgment is based on the fact that not until the end of the Qing period did Chinese begin importing moderate quantities of foodstuffs from the outside world to help feed its population; and the fact that the handicraft sector never challenged agricultural dominance in the economy despite a symbiotic relationship between them.By the same token, urbanization rarely exceeded ten percent of the total population although large urban centres were established. For example, during the Song, the northern capital Kaifeng and southern capital Hangzhou had 1.4 million and one million inhabitants, respectively. In addition, it was common that urban residents also had one foot in the rural sector due to private landholding property rights.
People's Republic of China
Since 1953, the government of the People's Republic of China has changed its official criteria of urbanization at least six times. In 1949, the year that the People's Republic of China was founded, less than 10% of the population in mainland China was urban. Few cities at that time could be considered modern. The early PRC took a cautious approach to urbanization, with its national development strategy citing the principle of "controlling large cities, developing small cities cautiously."Throughout the Mao Zedong era, Chinese state planners designed urban areas with an explicit purpose of developing a socialist citizenry, including through the construction of work units called danwei, which provided housing, jobs, food, health care, and other elements of the iron rice bowl on-site. In the view of state planners, the design of the danwei would help promote proletarian consciousness and advance the progress of state socialism.
During the period of the First Five Year Plan, China's urban planning was heavily influenced by the Soviet Union's experience. Soviet urban planners first came to the PRC in 1949 and returned in 1952 and 1955. Soviet experts helped write China's national standards and guidelines and Soviet text books and regulations were translated into Chinese. In the early part of the 1950s, city plans also followed the socialist city planning principles from the 1935 Moscow Master Plan. These principles included maintaining the old city core as administrative areas while building industry on the periphery with green space and residences between the two. During the First Year Plan period, the urban population grew by 30%.
Influenced by Soviet disurbanists, China built satellite towns around industrial centers. Industrial-focused satellite towns include seven built by Shanghai in the late 1950s, among which were Minghang, Anting, Jinshanwei, and Wusong.
Urban population experienced a 'great jump' in 1958–1961 during the Great Leap Forward in conjunction with the massive industrialization effort. During the Cultural Revolution years of 1965–1975, urban population growth dropped as a result of rustication. From 1962 to 1978, it is estimated that almost 18 million urban youth moved to the countryside. Overall during the Mao-era, the urban population grew at a lower rate than the rural population did.
However, after reforms were launched at the end of 1978, urban population growth began to accelerate. The inflow of foreign direct investment created massive employment opportunities, which fostered urban population growth. In the 1990s, urban population growth started to slow. This reflected a slower increase in employment growth following the restructuring of the state-owned enterprises.
Although migration to urban areas has been restricted since the late 1950s, as of the end of 1985 about 33 percent of the population was urban. An urban and industrial corridor formed a broad arc stretching from Harbin in the northeast through the Beijing area and south to China's largest city, the industrial metropolitan complex of Shanghai.
The uneven pattern of internal development and settlement, so strongly weighted toward the eastern part of the country, doubtless will change relatively little even with developing interest in exploiting the mineral-rich and agriculturally productive portions of the vast northwest and southwest regions. The adverse terrain and climate of most of those regions have historically discouraged dense population.
In 1987 China had a total of twenty-nine provincial-level administrative units directly under the central government and the Chinese Communist Party in Beijing. In addition to the twenty-one provinces, there were five autonomous regions for minority nationalities, and three special municipalities --the three largest cities, Shanghai, Beijing, and Tianjin. A 1979 change in provincial-level administrative boundaries in the northeast region restored Inner Mongolia Autonomous Region to its original size at the expense of Heilongjiang, Jilin, and Liaoning provinces. Urban areas were further subdivided into lower-level administrative units beginning with municipalities and extending down to the neighborhood level.
China's urbanization rate was significantly less than the world average, and it began to catch up after 1978. Since 1978, the year-to-year increase in urbanization rate has been significantly higher than in the rest of the world. From 1982 to 1986, the urban population increased dramatically to 37 percent of the total population. This large jump resulted from a combination of factors. One was the migration of large numbers of surplus agricultural workers, displaced by the agricultural responsibility system, from rural to urban areas. Another was a 1984 decision to broaden the criteria for classifying an area as a city or town. During 1984, the number of towns meeting the new urban criteria increased more than twofold, and the urban town population doubled. In the mid-1980s, demographers expected the proportion of the population living in cities and towns to be around 50 percent by the start of the 21st century. This urban growth was expected to result primarily from the increase in the number of small- and medium-sized cities and towns rather than from an expansion of existing large cities.
China's statistics regarding urban population sometimes can be misleading because of the various criteria used to calculate urban population. In the 1953 census, urban essentially referred to settlements with populations of more than 2,500, in which more than 50 percent of the labor force were involved in nonagricultural pursuits. The 1964 census raised the cut-off to 3,000 and the requirement for nonagricultural labor to 70 percent. The 1982 census used the 3,000/70 percent minimum but introduced criteria of 2,500 to 3,000 and 85 percent as well. Also, in calculating urban population, the 1982 census made a radical change by including the agricultural population residing within the city boundaries. This explains the dramatic jump in urban population from the 138.7 million reported for year-end 1981 to the 206.6 million counted by the 1982 census. In 1984 the urban guidelines were further loosened, allowing for lower minimum population totals and nonagricultural percentages. The criteria varied among provincial-level units.
Although country urban population—382 million, or 37 percent of the total population in the mid-1980s—was relatively low by comparison with developed nations, the number of people living in urban areas in China was greater than the total population of any country in the world except India. The four Chinese cities with the largest populations in 1985 were Shanghai, with 7 million; Beijing, with 5.9 million; Tianjin, with 5.4 million; and Shenyang, with 4.2 million. The disproportionate distribution of population in large cities occurred as a result of the government's emphasis after 1949 on the development of large cities over smaller urban areas. In 1985 the 22 most populous cities in China had a total population of 47.5 million, or about 12 percent of China's total urban population. The number of cities with populations of at least 100,000 increased from 200 in 1976 to 342 in 1986.
In 1987, China was committed to a three-part strategy to control urban growth: strictly limiting the size of big cities ; developing medium-sized cities ; and encouraging the growth of small cities. The government also encouraged the development of small market and commune centers that were not then officially designated as urban places, hoping that they eventually would be transformed into towns and small cities. The big and medium-sized cities were viewed as centers of heavy and light industry, and small cities and towns were looked on as possible locations for handicraft and workshop activities, using labor provided mainly from rural overflow. The urbanization of small and medium-sized towns has created different challenges for ethnically diverse areas, leading in some cases to an ethnic stratification of labor and greater potential for ethnic conflict.
In official discourses on urbanization in China, Shenzhen is considered the paradigmatic example of the 1980s approach to urbanization.
Since 1983, the trend in urbanization has been to expand cities and turn counties into subdistricts of cities. This process also re-classifies formerly rural residents and farmers into city residents, which provides them with access to urban public goods and services and which increases economies of scale for the provision of urban public goods.
Through the late 1980s and the early 1990s, the municipal government regulatory mechanisms expanded. The power of municipal governments increased, as did their capacity to regulate peri-urban areas. The 1994 fiscal reforms resulted in the need of local governments to generate non-tax revenue, which they did in the form of revenues through land development and use fees. This resulted in their increase in both administrative size and geographic size. The 1994 fiscal reform also impacted patterns of urbanization and domestic internal migration. Under the pre-1994 system of fiscal contracting, township and village enterprises had been an important mechanism of industrialization and most peasants who sought a factory job chose to stay in their hometowns and work at TVEs. TVEs began to decline after the 1994 reform and this contributed to major increases in workers migrating to urban areas.
Urbanization in China greatly accelerated in the 1990s. During this decade, the percentage of China's population which was urban first reached 50%. Extensive urban planning efforts made this urbanization process orderly and, unlike other developing countries, China was able to eliminate large scale squatter towns. In older urban areas, pre-revolutionary housing and danwei compounds were demolished beginning in the 1990s. Many of Beijing's famous hutong lanes were demolished during the period 1989–2019, with remaining lanes often converted into tourist attractions as objects of historic preservation.
In official discourses on urbanization in China, Pudong is considered the paradigmatic example of the 1990s approach to urbanization.
"Themed towns" in China adopt Western-style architecture and urban designs. Among the most significant examples of this approach is Shanghai's One City, Nine Towns initiative, which began in 2001.
In 2005, China had 286 cities. Most of China's cities have a population of one million and below. Shanghai is the largest city in China, with a population of 19 million, followed by Beijing with a population of 17.4 million.
Following the start of the Eleventh Five-Year Plan in 2006, China introduced a series of policies designed to encourage the development of sustainable cities.
The pace of urbanization in China accelerated in 2008. In 2011, a majority of Chinese citizens lived in urban areas and had urban residential status. Since 2013, its urbanization rate is higher than the world average.
During the general secretaryship of Xi Jinping, China's urbanization efforts have aimed at reclassifying millions of rural hukou holders as urban people and resettling them in urban areas. China's goal is to urbanize 250 million citizens by 2025 as the first phase of a long-term green modernization plan. One of the primary mechanisms for working towards this goal is through the settlement of formerly rural people in provincial capitals, prefectural cities, and county-level towns in central China and western China.
Under the 2014 National New-Type Urbanization Plan, the Chinese state seeks increase urban-rural coordination by incorporating rural planning as part of municipal governments' planning processes. The 2014 plan sought to attribute an urban hukou to 100 million people by 2020. It relaxed restrictions on small cities and medium cities. It maintained strong hukou restrictions on cities of more than 5 million inhabitants.The National New-Type Urbanization plan also requires 20% of municipal regions to be zoned as ecological protection areas. Xiong'an is presented in official discourses on urbanization as paradigmatic of the 21st century approach to urbanization.
Before the 2020s, the majority of urban growth generally consisted of outward expansion from city centers, mostly into former farmland.
At the end of 2024, the Chinese government stated that the urbanization rate was 67 percent. In 2025, the United Nations calculated China's urbanization rate at 83.7 percent, with the absolute number of people living in cities having peaked in 2021. The United Nations predicts China's urban population to climb to 86.8 percent in the 2030s.