The evolution of the Zhengyang Community Mental Health Rehabilitation Centre described in this paper proves that community-based mental health services initiated and developed by enthusiastic and committed community members can be successful in the Chinese setting. The most important step is to utilise community resources to secure a stable source of income, preferably by establishing a profitable welfare enterprise that can both finance the provision of other services and provide work for mentally ill clients who cannot obtain regular employment. The ultimate goal is to reintroduce as many clients back into the community as possible, so a range of services is needed: supervision of medication, social skills training, occupational rehabilitation, and, most importantly, work placement. The vitality of the organisation depends on its flexibility and responsiveness to the changing needs of patients; it must use its experience to guide policy decisions about the development of new services and the alteration or termination of existing services.