Traditional Chinese literary theory focuses on the role of the author. It emphasizes the emotion of the author and highlights the social influence of literature; the popular novel, on the other hand, focuses on the role of the reader. It stresses that literature can, through certain ways, attract and move the reader. This situation leads to a new mode of literary conceptualization, differing from traditional literary theory, and consequently enlarges the content and meaning of literature. Among all kinds of modern Chinese popular novels, the knight-errant novel is the most popular and significant genre, from the perspectives of its quantity and readership. Furthermore, the characteristics of the knight-errant novel: "Wu," "Ancient" and "Virtual Society," make it rich in traditional Chinese culture. Analyzing the knight-errant novel provides us the best opportunity to understand the essential features of modern Chinese popular novels and build up new literary theories. The study of the knight-errant novel can be proceed from four different perspectives: cultural, social, literary and entertainment. For the time being, the most important and fundamental research work is to collect, compile and preserve those buried and obscure sources of knight-errant novels, including collecting documents, compiling bibliographies, and interviewing the authors of knight-errant novels.