When it comes to the discussion of Chu Hsi’s theory of t’uo-jan-kuan-t’ung, what he said about “investigate every natural phenomenon” or “study classics and history” tend to induce us to believe that he advocated an approach of induction of the ultimate principle by acquisition and accumulation of knowledge. However, such an interpretation would result in contradictions. While knowledge is resulted from inquiring into empirical li, kuan’tung aims at ontological li or T’ai-chi. The former concerns with empirical content and concepts, it can indeed be obtained by induction or generalization. But the latter cannot be reached in this way, it is in a realm “without emotion, deliberation and intention…just a pure and clear world of consciousness.” Chu His used paradoxical expressions such as “omniscient,” “rough is delicate, and small is large.” Thus, the accumulation of knowledge is just the first phase of ko-wu-chih-chih. Actually Chu Hsi concened even more with moral reflection, as he said “to explore the moral feelings deep inside.” Chu His had emphasized the importance of the internal approach over the external one. This is the second phase of ko-wu-chih-chih that results in a moral insight. Its limitation lies in that it provides no answer to the paradoxical expressions, and it does not concern enough with moral practice. Kuan-tung, which is the last phase of ko-wu-chih-chih, is the mental state resulted form the radical transformation that goes beyond the first two phases. It is a mental state with heightened moral consciousness as well as the will to do moral acts. I try to provide arguments to support such a point of view in this paper.