This dissertation examines the historical practices and literary representations of “agrarian commune” from 1949 to the contemporary age in People’s Republic of China, focusing on its ambiguous role in the heterogeneous formation of Chinese modernity. Current Chinese literary studies have not explored the literary imagination of “agrarian commune” and its relation to modernity. Combining the Marxist political-economic analysis of China’s socio-economic reality with the textual analysis of literary works, this study seeks to explore how this “non-capitalist” formation of “commune” articulates with the “capitalist sector” in the uneven structure of China’s national economy in a complex way: on the one hand, it creates an “internal border” within China and serves for the internal primitive accumulation for the state; on the other hand, it produces the resisting elements that continually contest and disrupt the logic of capitalism, and opens the possibility for alternative practice of the “common life” that transcends the logic of capital and state. This study unpacks the complexity of “commune” in different periods through the reading of literary works. Chapter One focuses on the “collectivization movement” in socialist period and explores Zhao Shuli and Liu Qing’s divergent conceptions about the “agricultural cooperative” in relation to the state. Chapter Two focuses on the “underclass literature” that captures the living conditions of rural migrants under the “household contract responsibility system” in the era of market economy and global capitalism. Chapter Three examines the recent effort of reviving the “commune” and “common life” in the “New Co-operative Movement” promoted by New Left intellectuals after the year 2000, focusing on Wang Anyi and Liu Jiming’s novels. By looking into the different ways that the collective land ownership interacts with capital and the state throughout different stages of modern China, this study shows how the rural “outside” plays both a “productive” and a “subversive” role in the global uneven structure of capitalism, thereby enriching the discussion of “uneven development” in Marxist scholarship, and filling a blank spot in current Chinese literary studies regarding the rural modernity.