ABSTRACT In the early reform era, various forms of popular religion regained their role in maintaining moral order and low-level social control in rural communities. It was one of the main reasons that the Chinese Communist Party, a political party espousing state atheism, allowed and even endorsed the revival and flourishing of popular religion. Following on from that, though, the profound socio-economic transformation of the Economic Reform era began to reshape the landscape of Chinese rural society. As a consequence, the divine sanctioning power and communal function inherent in popular religion weakened, and thereby the undermining of the socio-religious function of enforcing moral and social norms derived from it. This then contributed to the decline of rural grassroots autonomous organisations which in turn allowed the authoritarian party-state to strengthen its autocratic power and exercise direct and uncompromising political control over Chinese rural populations. This article addresses the phenomenon from a socio-anthropological perspective, using the example of nuo, a form of popular religion commonly practiced in south-west China. This work is based on the author’s continuous decades-long fieldwork and research on Chinese popular religion.