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Historically, China's National Army was founded in 1925 to unite the country versus the warlords. The Chinese Army is based on three different levels.

The first and highest level is called the "National Army ". It is composed of full-time professional soldiers who are trained and equipped to a high standard. The National Army would be roughly comparable in most respects to a European army, though it might not always be able to rise to the same level of equipping and training.

The next level is the "Territorial Army ". These units are raised (conscrpited) in the Chinese provinces, and are mainly used as military-style police troops for maintaining local order. While they have some new equipment, much of their gear is older and passed down from the National Army. In the event of a major war, Territorial Army units may be called out to serve as second or even first-line units to bolster the National Army. While also volunteers still serve in the Territorial Army, the main part of these units is maintained through conscription. Supporting arms, such as artillery, will be older and more scarce than in the National Army.

The final, and lowest, level of the army is the "Reserve Army ". Like the Territorial Army, these units are raised by the provinces and almost always employed locally. They have the poorest level of training and equipment, with training likely varying by the commanding officer and equipment being particularly old. While they will be formed in modern-style regiments, their supporting arms (artillery, AT, communications, etc) will be poor to nonexistent. The Reserve Army units include some penal battalions (criminals sentenced to service for hard-labour tasks).

The National Army represents the Chinese front-line, and regiments are deployed away from their "home province" at the pleasure of the Chinese General Staff. On the other hand, the Territorial and Reserve Armies are generally tied to their home provinces or maximum the prefectures (see below), unless specific orders are given by the emperor and the relevant Chinese governing bodies to detach them for specific service (with certain conditions applying).

Due to the chinese empire´s large population and area, the administrative divisions of China have consisted of several levels since ancient times. The constitution of the chinese empire provides for three de jure levels of government. Currently, however, there are five practical (de facto) levels of local government:

The Chinese Empire administers 7 prefectural level regions, 25 provincial level regions, over 2000 county-level regions, over 30.000 township-level regions and even more village-level regions.

Additional there is one Autonomous Region in China, Tibet. An autonomous region is, like the "normal provinces" also a first-level administrative subdivision of the chinese empire. Like chinese provinces, an autonomous region has its own local government, but an autonomous region theoretically has more legislative rights, including: independence of finance, independence of economic planning, independence of arts, science and culture and use of local language. In addition, the head of government of each autonomous region is known as a "chairman", unlike provinces, where they are known as "governors". Thus an Autonomous Region has internal political autonomy and religious freedom, representation in foreign policy, foreign trade and in military affairs but is claimed by the government of the Chinese Empire.

Prefectures are the top-level administrative divisions of the chinese empire that directly governed provinces. These are the largest political divisions of China and were controlled by the Central government.

Since the 17th century, provincial boundaries in China have remained largely static. Thus the provinces serve an important cultural role in China, as people tend to identify with their native province.

China has 25 provinces and each province matched a Provincial Military District. This Provincial Military District has several responsibilities. The District Commander is responsible for reporting to the larger regional-level commanders on the state of military affairs within his assigned province. Also he is responsible for commanding all local military operations, that are the responsibility of the Territorial and Reserve Armies in his district. Third, the District Commander is responsible for raising the required regiments for the National, Territorial, and Reserve Armies. Finally, the District Commander is responsible for building and maintaining Provincial Arsenals for weapons.
Each Provincial Military District is responsible for raising one regiment for every one million citizens in the province. For every five regiments, one regiment is assigned to the National Army, two regiments are assigned to the Territorial Army, and two regiments are assigned to the Reserve Army. Each regiment raised in this fashion carries the Province's name as part of their unit designation.

For example, let us take the Province of Guangxi. With a population of 17,948,899 persons, the Guangxi Provincial Military District is responsible for raising eighteen regiments for the army. According to this method, four regiments are sent to the National Army, seven are assigned to the Territorial Army, and seven to the Reserve Army. The unit designation is for example "1st National Infantry Regiment (Guangxi)", or "2nd Territorial Infantry Regiment (Guangxi)".

For the Territorial and Reserve Armies, the Provincial Military Districts are expected to raise their own support troops as well, in order to form them into full-sized infantry divisions. As mentioned above, the Province Guangxi can raise seven Territorial and seven Reserve regiments, they will be formed into two Territorial Divisions and two Reserve Divisions. An example for unit designation is "17th Territoral Infantry Division (Guangxi)".

The raised territorial army of each province is always stationed within their province or maximum the associated prefecture.

In every province with more than ten million civilians, the Provincial Military District is additional responsible for recruiting one regiment for every ten million civilians (rounded). These regiments, drawn from more populous areas, are the base for development of specialized troops (e.g. armoured troops, airborne etc.).

The Regiment is the building block of the chinese army. These locally-raised units, particularly at the National Army's level, maintain a soldier's sense of camaraderie, as he's fighting alongside countrymen from his own general home region. This maintains the soldier's sense of being connected to his home, and allows for fostering of better relations between the soldiers themselves. In all three levels of the Chinese Army, a soldier is encouraged to equate his "group identity" with his regiment.
With the twenty-five provinces and the populations shown in the table, China can raise 497 regiments in the fashion outlined above. 111 regiments in the National Army (fault in the table above !!!), 199 regiments in the Territorial Army, and 187 regiments in the Reserve Army. Those provinces with over twenty million persons additionally recruit another 38 regiments into the National Army, bringing it to a grand total of 149 regiments in the National Army.
Historically, German military advisors helped set up an order of battle for the Chinese Army's divisions. Each division consists of four infantry regiments (formed into two brigades), plus supporting arms. Unlike the Territorial and Reserve Army divisions, National Army divisions are composed of regiments from around China, thus they do not carry a geographical designation (though their constituent regiments do). For example "8th National Infantry Division".
Thus, the Chinese Army breaks down into roughly 28 National, 50 Territorial, and 47 Reserve Infantry Divisions, with ten additional Specialist divisions for the Nationalist Army.
Due to China's mountainous regions, at least five divisions (from the specialist divisions) are established as mountain troops, five divisions established as light infantry. The light infantry units have higher proportions of automatic weapons (machine guns, SMGs, etc) but a lower proportion of supporting arms (artillery). China has three armoured infantry divisions, one airborne light infantry division (specialist division), also one marine light infantry division (specialist division), four cavalry divisions and three tank divisions (specialist devision).