Most Chinese characters are compounds consisting of a semantic radical indicating semantic category and a phonetic radical cuing the pronunciation of the character. Controversy surrounds whether radicals also go through the same lexical processing as characters and, critically, whether phonetic radicals involve semantic activation since they can also be characters when standing alone. Here we examined these issues using the Stroop task whereby participants responded to the ink color of the character. The key finding was that Stroop effects were found when the character itself had a meaning unrelated to color, but contained a color name phonetic radical (e.g., “guess”, with the phonetic radical “cyan”, on the right) or had a meaning associated with color (e.g., “pity”, with the phonetic radical “blood” on the right which has a meaning related to “red”). Such Stroop effects from the phonetic radical within a character unrelated to color support that Chinese character recognition involves decomposition of characters into their constituent radicals; with each of their meanings including phonetic radicals activated independently, even though it would inevitably interfere with that of the whole character. Compared with the morphological decomposition in English whereby the semantics of the morphemes are not necessarily activated, the unavoidable semantic activation of phonetic radicals represents a unique feature in Chinese character processing.