Rapid urban expansion often has negative social, environmental, and ecological consequences. In China, urbanization rates have increased rapidly over the past decades, commensurate with economic growth. This article evaluates how Chinese urban planning was effective in containing urban expansion. To this end, we examined discrepancies between the Land Use Master Plan (LUMP) and the actual land use developments between the years 1996 and 2014, and analyzed them in relation to demographic and land-use change. Our findings reveal that the initial aim outlined in the LUMP proved, from the start, difficult to implement and that certain targets were either not met or surpassed. Remarkable is that the rates of land used for urbanization strongly exceed those of urban population growth. Explanations are sought in a combination of decentralization, marketization and globalization. We argue that urban growth management is challenged by the shift from the centrally planned system to a more market-oriented governance system, with the slowly increasing autonomy of local governments, which creates incentives for the latter to stimulate urbanization rather than to control it.