Using the latest forest inventory, this article provides a detailed analysis of China's changing forest sector by focusing on new forest trends, forest policy changes, and challenges to achieving a sustainable forest management. The authors analyze the dynamics of forest resources and provide an impact assessment of forest policies on China's forestry development during the past decades. Moreover, the analysis of the forest market highlights substantial disequilibria marked by a limited domestic supply potential and a growing demand for forest products satisfied by increasing imports. Internal and external solutions are explored, and their implications for China and supplying countries are assessed.