Internet evolution has skyrocketed in recent years. The China Internet Network Information Center (CNNI) reported there were 26,500,000 people online in China by the end of June 2001. Like many developing countries, China has considered the Internet a powerful tool for national development economically and socially. As Internet growth becomes more and more significant, it becomes important to outline the present status of Internet development and usage in China and identify the major barriers to Internet adoption. This paper analyses and assesses the current state of Internet expansion and Internet use in China and compares two different diffusion models. It focuses on the factors that led to current conditions and which will likely influence future development.