This report analyzes the small business condition in China since the businessand commercial system reform. Data from the State Administration of Industry and Commerce demonstrate that，there is a significant increase on the number of newly established small businesses. Also from the data released by the Chinese Individual Workers Association（the 2015 Survey of National Newly Established Small Businesses’ Active Level），the small businesses’ active level，operation period，income and revenue，and the employment situation，have been examined. Many problems and challenges have been proposed with a series of policy recommendations.