Based on more than two years of ethnographic fieldwork in Hunan, the prototype of rural China, this dissertation explains why a predatory state emerged in China at the village, township, and county levels in the 1990s. It also explores patterns of peasant resistance to the predatory state and analyzes the impact of peasant protest on local and national rural policies. The local government in rural China experienced a profound fiscal crisis in the 1990s. Because of internal corruption and competition from the private sector, the public sector collapsed, depriving local governments of their main source of revenue. The tax-sharing system adopted in 1994 and various unfunded central mandates significantly increased local fiscal responsibilities. The fiscal crisis induced local governments to impose ever-increasing taxes and fees on peasants. The rise of the predatory local state led to widespread peasant discontent. In only a few cases, however, did peasants succeed in mounting sustained protest against the local government. This happened when peasants sensed an opening in the political opportunity structure and when peasant leaders emerged. Protests usually started when peasants acquired central documents on lowering peasant burdens, which they used to argue that they had the right to withhold taxes and fees. Peasant leaders were ?peasant cadres? and ?peasant intellectuals,? who were better-educated than other peasants and who had worked for the party-state at some point in their lives. As a result, they could speak and write well. They also had good knowledge of party polices, which allowed them to challenge the interpretative framework of the local government without appearing to question the legitimacy of the party-state. Finally, they provided a shield of protection for their fellow villagers. The state eventually repressed most protests by jailing protest leaders. However, protestors sometimes obtained economic concessions from the local government. Moreover, in the 2000s, the central government reformed rural public finance and introduced subsidies to peasants and local governments (the ?tax-for-fee reform? and the policy of ?constructing the new socialist countryside?). This cycle of revenue maximization, resistance, and reform illuminates the interactive and mutually transformative relationship between the state and society in China.