Research and theory in reading have tended to focus on English and other alphabetic languages. Even if non-alphabetic languages are the focus of reading research, they are primarily studied from a perspective of alphabetic languages. There is little attempt to build research on analysis of the Chinese writing system. This article reports research that is based on a thorough analysis of the Chinese writing system, which has a continuous 2000-year history of use and rivals alphabetic systems in the number of users, world-wide. The research uses miscue analysis in the study of events in oral reading where the observed response to a complete authentic text differs from the expected response. The analysis of the Chinese writing system is provided in the article. This description was the base for a major contribution of the study, the Taxonomy of Chinese Miscues adapted from the Taxonomy of Oral Reading Miscues (Goodman, 1973). The article also places Chinese literacy in its cultural context. The finding that Chinese readers make miscues in similar proportions to readers of alphabetic orthographies is itself important because it shows that Chinese reading is a process of meaning construction and much more than the sequential recognition of characters. Chinese reading employs the same psycholinguistic strategies and use of cues from the text as reading in alphabetic languages. Twelve fourth semester students of Chinese read a complete authentic Chinese text. The resulting data provide a baseline of data for further study of Chinese reading since it avoids the imposition of inappropriate units of alphabetic orthographies such as words, sentences and phonic correspondences. Data from L1 readers are offered for comparison. Goodman’s transactional model and theory of reading, writing, and written texts (1994, 1996, 2003), which views reading as primarily the construction of meaning, is thus shown to be applicable to reading Chinese. Chinese readers use the structure of Chinese characters in semantic and syntactic context to make sense of print with little use of phonics. This finding is consistent with the Chinese historical and cultural view that the writing system yì (meaning; essence; spirit; interior) is the essential part of the whole semiotic system. In contrast to yì, xíng (forms; formats; outer) is merely a surface whose form represents what lies within. In Chinese society, reading is not only to construct the yì of written texts, but also to construct the yì of a culture. By means of constructing yì, the function of reading is fulfilled from the perspectives of both self-cultivation and social transformation.