Forest enterprises are the basic entities to manage forests.The main contents of this article include:providing anobjective assessment of the current status of small and medium forestry enterprises (SMFEs) in China;identifying and characterizingthe determining factors that affect the development of SMFEs in China,including property right arrangements,organizationalarrangements,taxation and credit/financing arrangements;and analyzing the positive and negative impacts of governmental policieson the development of SMFEs and the mechanisms through which such impacts are realized. Forest enterprises are the basic entities to manage forests. The main contents of this article include: providing anobjective assessment of the current status of small and medium forestry enterprises (SMFEs) in China; identifying and characterizing the determining factors that affect the development of SMFEs in China , including including right right arrangements, organizationalarrangements, taxation and credit / financing arrangements; and analyzing the positive and negative impacts of governmental policieson the development of SMFEs and the mechanisms through which such impacts are realized.