With the modernization of China in the 20th century, Chinese museums have developed over the past 100 years and are entering an era of prosperity. Since 1949, under the influences of various historical factors and events, museums have changed the way they function to adapt to changes in policies and have formed different administration systems. This paper begins with a brief overview of the history of Chinese museums after 1949, and introduces current administration systems and important regulations. It then describes the present condition of the Chinese museum industry including factors involved in the promotion of museums, such as free-visit policy, bringing museum resources into the educational system, accumulation of professional resources from international exchanges, setting up of criteria for specialization and standardization, increasing support for collection conservation and restoration from the government, emergence of eco-museums and industrial museums, and progressive interest in museum management. Finally, several current issues are discussed to provide a comprehensive view of the development of museums in China.