Development of effective immunosuppressive agents and advances in surgical practice are the main reasons for the success of transplantation in China. In some key areas such as liver, lung, and kidney transplants, Chinese transplant success rates are similar to the rates in developed countries. Organ donation also has developed rapidly. However, China is facing a serious organ shortage that restricts clinical treatment and medical research. This shortage is due to imperfect laws and improper management of organ donation, as well as Chinese traditional ethics. Finding an efficient way to make the number of donated organs keep pace with the need for organ transplants and to optimize allocation of organ resources is a long-term and arduous task. In some ways, Chinese organ donation nowadays is constrained more by legal issues than by medical issues. The current status of and challenges facing organ donation in China are analyzed with respect to ethics, management, laws, and policy, and the future development of transplantation in China is discussed.