The purpose of this research is to precipitate the characteristics of the reform of China’s Compulsory Education Funds Guarantee System and to examine the effect of that reform. As is generally known, China is called as the dualistic society. The imbalanced circumstances exist in China. Although the compulsory education of all regions have developed in recent years, there still exist discrepancies between urban and rural areas, between different regions and between different schools, and there is a tendency of a widening discrepancy in some regions and in certain aspects, which has turned into a problem that needs highlighted attention in the development of compulsory education. Therefore, the Chinese Minister of Education promulgated “Some Opinions of Promoting the Balanced Development of Compulsory Education” in 2005. Furthermore, since 2006, the Chinese government has begun to implement reform of the rural compulsory education funds guarantee system.