In recent years, China has instituted a variety of reforms to its hukou system, an institution with the power to restrict population mobility and access to state-sponsored benefits for the majority of China's rural population. A wave of newspaper stories published in late 2005 understood the latest round of reform initiatives to suggest that the hukou is set to be abolished, and that rural residents will soon be “granted urban rights.” This article clarifies the basic operations of the hukou system in light of recent reforms to examine the validity of these claims. We point out that confusion over the functional operations of the hukou system and the nuances of the hukou lexicon have contributed to the overstated interpretation of the initiative. The cumulative effect of these reforms is not abolition of the hukou, but devolution of responsibility for hukou policies to local governments, which in many cases actually makes permanent migration of peasants to cities harder than before. At the broader level, the hukou system, as a major divide between the rural and urban population, remains potent and intact.