Rapid urbanization in China has potentially caused increasing risks to underground transmission hazardous material (hazmat) pipelines, significantly impacting on public safety. Challenges to risk management of underground transmission hazmat pipelines in China were analyzed from the aspects of dangerous characteristics of underground pipelines accidents, the harsh situation of hidden dangers and the rectification difficulties. According to the data collected from authoritative sources, 170 underground transmission hazmat pipelines accidents in China between 2007 and 2013 were investigated statistically. The characteristics of accidents were analyzed from the aspects of the annual total quantity of accidents, the total casualty toll of accidents, and general causes and consequences of accidents, which illustrated the growing trend of potential accidents risk recent years. Besides, according to the survey results of the nationwide inspection on hidden dangers in transmission hazmat pipelines, 29436 hidden dangers, including 19072 hidden dangers with ground surface occupation, 9171 with inadequate safety distance, 8293 with irregular cross-laying or across, were revealed, and the essential problems of eliminating them were pointed out specifically. Furthermore, the underlying causes that lead to the challenges to risk management of underground hazmat pipelines are analyzed in detail, i.e., ineffective implementation of integrity management programs, unclear administration responsibility, limitations of current code and standard, disparity of risk assessment approaches, deficiency of pipeline failure information management. Finally, based on the cause analysis, suggestions and countermeasures for risk management of underground transmission hazmat pipelines were put forward, which will offer significant insight into hazmat pipeline accident prevention.