The objective of this study was to develop a competency-based clinical skills teaching and assessment programme in China utilizing modern teaching techniques. Medical teachers from three schools agreed on items for inclusion in the complete physical examination of an asymptomatic adult, an outline for an adult and paediatric history, and important interviewing skills. Lesson plans, performance checklists, and written and videotape training materials were developed. Standardized patients were trained at one school to assist with the teaching at that school and with the assessment at all three schools. A national, a provincial, and a local medical school in China were used. Before beginning the new curriculum for students in their first year of clinical training, baseline data were collected on skills of students at various levels of training in the previous curriculum at all three schools. Although in the previous curriculum there was some improvement in clinical skills among advanced compared to more junior students, performance was lower than expected by staff. One year after implementation of the new curriculum, students were evaluated. These students significantly outperformed their counterparts as well as the more senior level students tested the previous year. This project has established a competency-based teaching and assessment programme in China that allows for rapid improvement in the clinical skills of students. Within a short time, a sophisticated group of medical educators has been formed, who now function as consultants to other educators in their own country. Many aspects of this programme are being adapted throughout China and are applicable to medical schools throughout the world.