Higher education in China is currently undergoing a process of re-orientation. This paper focuses specifically on the development of transnational higher education (TNHE) in China over the last decade, as well as its implications for university governance. Major features of TNHE programmes in China will be explored, and a corresponding typology will be presented. We argue that in the face of the fast expanding activities of TNHE, the common irregularities in programme operation, and the less effective and efficient mechanism of quality assurance, may well be the major challenges for university governance in China. Structural reform in university governance is desirable, particularly in terms of empowering the non-public sector in Chinese higher education and of separating the role of the Party from academic administration.