This was the intellectual modernization of China marked by students of the National University in Beijing demonstrating against the government and their pro-Japanese adherents on 4th May 1919. When the police attacked the students and jailed some, more demonstrations and student strikes and finally a general boycott of Japanese imports were the consequence. In these protest actions, professors such as Cai Yuanpei, later president of the Academia Sinica, took an active part. The forces which had now been mobilized, rallied around the journal "New Youth", created in 1915 by Chen Duxiu. The journal was progressive, against the monarchy, Confucius, and the old traditions.

Hu Shih gained greatest acclaim by his proposal for a "literary revolution", published in the "New Youth" in 1917. This revolution was the logically necessary application of the political revolution to the field of education. The new "vernacular" took place of the old "classical" literary language. The language of the classical works is so remote from the language of daily life that no uneducated person can understand it. A command of it requires a full knowledge of all the ancient literature, entailing decades of study. The gentry had elaborated this style of speech for themselves and their dependants; it was their monopoly; nobody who did not belong to the gentry and had not attended its schools could take part in literary or in administrative life. The literary revolution introduced the language of daily life, the language of the people, into literature: newspapers, novels, scientific treatises, translations, appeared in the vernacular, and could thus be understood by anyone who could read and write, even if he had no Confucian education.

In 1917 China declared war on Germany in the hope of recovering its lost province, then under Japanese control. But in 1918 the Beijing government signed a secret deal with Japan accepting the latter's claim to Shandong. When the Paris peace conference of 1919 confirmed the Japanese claim to Shandong and Beijing's sellout became public, internal reaction was shattering. On May 4, 1919, there were massive student demonstrations against the Beijing government and Japan. The political fervor, student activism, and iconoclastic and reformist intellectual currents set in motion by the patriotic student protest developed into a national awakening known as the May Fourth Movement. The intellectual milieu in which the May Fourth Movement developed was known as the New Culture Movement and occupied the period from 1917 to 1923. The student demonstrations of May 4 were the high point of the New Culture Movement, and the terms are often used synonymously. Students returned from abroad advocating social and political theories ranging from complete Westernization of China to the socialism that one day would be adopted by China's communist rulers. Chinese diplomatic failure and the government's weak response to the Treaty of Versailles, especially the Shandong Problem. These demonstrations sparked national protests and marked the upsurge of Chinese nationalism, a shift towards political mobilization and away from cultural activities, and a move towards populist base rather than intellectual elites. On the morning of May 4, student representatives from thirteen different local universities met in Beijing and drafted five resolutions:

On the afternoon of May 4 over 3,000 students of Peking University and other schools gathered together in front of Tiananmen and held a demonstration. The general opinion was that the Chinese government was "spineless". Leaders of the New Culture Movement believed that traditional Chinese values were responsible for the political weakness of the nation. They voiced their anger at the Allied betrayal of China and the government's inability to secure Chinese interests in the conference. The next day, students in Beijing as a whole went on strike, and students in other parts of the country responded one after another. Chancellors from the thirteen of China's tertiary institutions initiated the rescue of student prisoners. Congregations such as media outlets, citizen societies, and chambers of commerce offered their support for these students. Merchants further illustrated support for the students by resisting tax payments if China's government remained obstinate. In Shanghai, these May Fourth events culminated into general strikes by merchants and workers that nearly devastated the entire Chinese economy. Under intense public outcry, the Beiyang Government had to release the arrested students and dismiss Cao Rulin, Zhang Zongxiang and Lu Zongyu from their posts.

The May Fourth Movement won the initial victory. However, this move was more symbolic than anything else. Japan still retained control of the Shandong Peninsula and the islands in the Pacific it had obtained during World War I. Even though these protests and marches did not manage to achieve all their objectives, the partial success of the movement exhibited the ability of China's various social classes to successfully collaborate, an ideal that would be admired by both Nationalists and Communists.

The challenge to traditional Chinese values, however, was also met with strong opposition, especially from the KMT. From their perspective, the movement destroyed the positive elements of Chinese tradition and placed a heavy emphasis on direct political actions and radical attitudes, characteristics of the emerging Chinese Communist Party. The Communist Party viewed the movement more favourably, although remaining suspicious of the early phase which emphasized the role of enlightened intellectuals, not revolution. In its broader sense, the May Fourth Movement led to the establishment of radical intellectuals who went on to mobilize peasants and workers into the Communist party and gain the organizational strength that would solidify the success of the Communist Revolution.

Chiang Kai-shek, as a nationalist, and Confucian, was against the iconoclasm of the May Fourth Movement. He viewed some western ideas as foreign, as a Chinese nationalist, and that the introduction of western ideas and literature that the May Fourth Movement wanted was not welcome. He and Sun Yat-sen criticized these May Fourth intellectuals for corrupting morals of youth. Thus, the KMT, under Chiang Kai-shek's rule, carried out the opposite agenda of the May Fourth idealists. He started the New Life Movement, promoting Confucianism and decrying western ideals. The KMT purged China's education system of western ideas, introducing Confucianism into the curriculum. Education came under the total control of state, which meant, in effect, the KMT, via the Ministry of Education. Military and political classes on the KMT's Three Principles of the People were added. Textbooks, exams, degrees and educational instructors were all controlled by the state, as were all universities.