The industrial association （IA） is a non-profit social organization，composed of corporations within the same industry along with some other economic entities，providing inter-industry service and exerting self-regulating. Since 21st century，the Shanghai Industrial Association has played an effect role in the following aspects：enhancing the functional power and the authority；building the management system；assisting the government in public administration and providing service；getting involved in the policy-making process；protecting the legal interest of members etc. The main obstacles being so far confronted are as follows：existing regulations and laws concerning IAs are far from perfect；the roles played by the government，corporations and IAs are not yet clarified，making the multiple relations somewhat frustrating；significant differences still occur among various IAs，causing difficulty in building institutions. Hence，the government should value the public rights，establish institutions for negotiation on an equal term with the IAs，facilitate the inter-connection within the modern society and the self-regulating system，enhance the construction of a legal system to create a benign environment for the IAs，deepen the reform to increase IAs’ functional capacity，and establish an effective monitoring procedure to supervise the IAs’ operation.