China’s deepening leadership ties and growing economic relations with and support for Pyongyang during the recent period of leadership transition in North Korea seemed to enable North Korea’s egregious nuclear proliferation. The controversial Chinese actions can be explained as the latest episodes in China’s often twisted relations with North Korea since the end of the Cold War. Seeking stability on the Korean Peninsula is vitally important for China’s strategic environment, domestic stability and economic development. The chapter shows how China has responded to changing circumstances involving the Korean Peninsula in the post-Cold War period and how China’s often conflicted objectives have been reflected in shifts in Chinese policy and behaviour. Foreign observers often judged that China had a longer-term interest in expanding Chinese influence and reducing US and Japanese influence on the peninsula. As relations developed, however, China’s economic importance for South Korea was seen by South Koreans more in both negative and positive ways.