This chapter focuses on local public policies relevant to SME development and entrepreneurship in China. Previous research has mainly been concerned with specific policies and programmes promoting innovative SMEs and entrepreneurship at the national level. Using the documents of entrepreneurship policy initiatives and datasets on SME development in two contrasting provinces covering a period of 10 years, entrepreneurship policy in China is shown to be more complex than in most other countries, serving not only entrepreneurial activities but also institutional transition. Geographic disparities in SME development and entrepreneurship are demonstrated (see detailed analysis undertaken in Guangdong and Sichuan). As a result, whilst there are marked differences in the policy priorities in Guangdong and Sichuan, all levels of government share a common goal to promote entrepreneurship and innovation.