In addition to the perceived American-led strategy of peaceful evolution discussed in Chapter 2, China is apprehensive of US supremacy in international politics. The objective of this chapter is to explore how the US dominance in the international arena might represent challenges to China’s security – military, political and economic. Here, we need to examine how China perceives the US war on terror: the US appears justified in its merciless pursuit of terrorists because it was a victim of terrorism on September 11, but it also seems that the US has now used the global war on terror as a pretext to seek hegemony.