Abstract While the People's Republic of China appears on a daily basis in all of the important newspapers around the world with its enormous successes in modernizing its economy, life in the Chinese countryside usually does not attract international attention. However, we know from a wide range of reports that the situation in the Chinese countryside is getting more and more complicated with local corruption, pollution and poverty growing in most parts of the country. The Chinese language press reports on a growing number of local uprisings in remote areas. While some analysts regard the situation in the countryside as a potential threat to the ongoing peaceful process of economic reform in China, China seems to be well prepared to cope with this change and the state is comparatively flexible in dealing with unrest among the rural population. So far the system itself has not been challenged by peasant discontent. This article introduces the idea that the distance between state and rural society is the basis of this flexibility. It will analyze a major policy document issued by the state and party leadership in order to show how state and rural society interact on the basis of a still insurmountable distance between state and rural society.