This paper examines the ways in which the flourishing of the market economy has affected educational development in mainland China. Unlike the Mao era when educational development was entirely directed by the central government, there has been a strong trend of diversification and decentralization of education in the post-Mao period. In recent years, private schools and colleges have become more popular on the mainland, the development of which inevitably challenges the conventional public and private boundary. The principal goal of this paper is to examine how China's education has gone through a process of `marketization'. Based upon our field research conducted in mainland China, we argue that China's educational development has been significantly affected by emerging market forces. The core of the paper is confined to the discussion of four major issues: the emergence of private education, user charges and cost recovery in education, as well as the design of courses and curricula to meet emerging market needs in China. The main focus of this paper is thus concentrated on what strategies educational institutions have employed in response to the strong tide of marketization.