Farmland conservation is a new perspective in China's development policy making. In this paper, we seek to explore the distribution patterns of farmland loss between regions and among city-size groups, and to examine the factors and institutional background that influence on farmland conservation. A random sample of 179 out of 666 cities in 1996 was selected. Data were collected from various sources for the period 1993–96. Descriptive statistics, correlation analysis and nonparametric tests were used to analyze the data. Three-dimensional maps were plotted to present the distribution patterns of farmland loss, urban population growth and real estate development. The empirical results reveal that regional and hierarchical variations did exist in farmland loss, so did in urban population growth and real estate development. Farmland loss was more severe a problem in cities along the coast, especially cities with a nonagricultural population over two million. Urban population growth and real estate development were two main factors causing farmland loss in cities. Poor legal ground for land administration, weak law enforcement, and the drive towards fast revenue making were the underlying problems that prevented effective farmland conservation. In China's current transition from a planned to a market economy, farmland conservation can succeed only if government officials were no longer to trade off sustainability of development with short-term, fast revenue making.