On June 14, 1999, some 200–300 peasants surrounded the leadership compound in Maliu township, in impoverished Kai county, a remote, mountainous area up the Yangtze River from Chongqing in southwest China. The anger of the peasants had boiled over when they heard that cadres planned to renovate their office compound. Tensions had already been running high as cadres had been trying to squeeze extra funds from the peasants, and the thought that this revenue would be used to improve the lives of the cadres was simply too much. The peasants blocked the entrance to the township offices so there was no way for the cadres to leave the building. The local cadres’ first instinct was to respond forcefully: arrest the leaders and suppress the outburst. But there were no police stationed in Maliu township; they would have to come from the county seat, 66 kilometers away. More importantly, any police action to suppress the peasants would have to be approved by the Political and Legal Affairs Office of the Kai County Chinese Communist Party (CCP) Committee. Fortuitously, the head of the office was a former teacher in Maliu township, and many of the people involved in the protest were his former students. He knew they were not bad people, so he demanded that local leaders find a way to resolve the incident peacefully. He was backed by the party organization of Chongqing municipality, particularly its Organization Bureau.

Maliu township is a fairly typical mountain settlement. The population is highly dependent on agriculture, with 97 percent of the residents relying on agriculture as their main source of income. Spread over 94 square kilometers, Maliu township's 7,241 households live in twenty-four administrative villages and one street committee. Agriculture is difficult and unrewarding, so more than 6,000 of the township's 27,112 people had left to make their fortunes elsewhere. Of those remaining, more than 7,000, or about one-quarter of the population, were impoverished. Their annual incomes averaged about 1,021 yuan, less than half the average income in the township.