We intended to establish if two lexical tone contrasts in Zhumadian Mandarin, one between early and late aligned falls and another between early and late aligned rises, are perceived categorically, while the difference between declarative and interrogative pronunciations of these four tones is perceived gradiently. Presenting stimuli from 7-point acoustic continua between tones and between intonations, we used an identification task and a discrimination task with an experimental group of native listeners and a control group of Indonesian listeners, whose language employs none of the differences within either the falling or the rising pitch contours in its phonology. Only the lexical condition as perceived by the experimental group yielded sigmoid identification functions and a heightened discriminatory sensitivity around the midpoint of continua. The intonational condition in the native group and both conditions in the control group yielded gradient identification functions and smaller, reverse effects of the continuum midpoints in the discrimination task. The results are interpreted to mean that sentence modality contrasts can be expressed gradiently, but that lexical tone differences are represented phonologically, and hence are perceived categorically, despite low phonetic salience of the contrast. This conclusion challenges assumptions about the relation between linguistic functions and linguistic structures.