It needs to resolve four outstanding problems for China to balance urban and rural development. First，China shall ensure the basic supply of agricultural products to prevent the people’s livelihood from influences exerted by extremely unbalanced demand and supply of agricultural products. Second，China shall increase the income of farmers in a steady manner to reverse the momentum of increasingly wider income gap between urban and rural areas. Third，China shall enhance the supply of rural public utilities to promote the equal development of public services between urban and rural areas. Forth，China shall facilitate farmers to better integrate in cities to let farmer well participate in the process of urbanization. Developing service industry plays an important role in resolve the abovementioned outstanding problems and is an important way to balance the urban and rural development. This article finally puts forth several countermeasure and suggestions on how to play the role of service industry in balance the urban and rural development.