Abstract Principal as the key to school reform has been a frequently discussed topic in the research literature. However, few studies have investigated principals’ own values, views and visions and how these may affect reform in their schools. The study reported in this paper intends to fill this void. It is a joint effort by American and Chinese education scholars to explore and examine the profiles, preparation and perspectives of urban and rural principals in China, based on the conceptual framework and research methodology of the American national Study of the Education of Educators and the earlier comparative study of Chinese, American and Australian school principals. A comprehensive principal survey was administered to several hundred urban and rural school principals in China and interviews were conducted with selected principals. Our study findings reveal both similarities and differences in values, views and visions between urban and rural school principals, and a huge gap in the quality and equality of education between urban and rural schools. Although Chinese principals are in general progressive and liberal in their fundamental beliefs and values, they perceive great difficulties in realizing their visions for ideal schools and recognize major obstacles to reform because of the existing school conditions, the national examination system, and certain policy restrictions on their autonomy and decision-making power in schools. Findings from this study provide special insight to policy makers and education reformers and urge them to create necessary policies, improve conditions, and increase autonomy and decision-making power for principals to manage and effect changes in their schools, especially those in rural and minority areas.