In October 1927 the Kuomintang formally established the Nationalist government at Nanking and Chiang Kai-shek became chairman/dictator of the Kuomintang, maintaining his power with the help of the military and support by the bourgeoisie.

In 1928 Chiang's army marches to Peking, so inaugurating the unification of China. Although the force of the CCP (Chinese Communist Party) was greatly reduced by the Kuomintang, Mao Tse-tung (Zedong) reconstructed the CCP aiming to establish an 'army for the people', a strategy to use the farms to win the cities and establish bases in southern China. In 1927 the Chinese Red Army is formed in Hunan province.

The seizure of Manchuria by Japan in September 1931 and the establishment of the puppet state of Manchukuo under the dethroned Qing's last emperor, P'u Yi, caused an anti-Japanese campaign everywhere in China.

At this time, the Kuomintang considered it more important to exterminate the CCP than resist the Japanese invaders, a decision that was to help the Japanese but to doom the Kuomintang.

Conflict with Japan, from the early 30s to the end of WWII, and the rise of the CCP, undermined the Nanking government, and when Chiang's fifth extermination campaign of the CCP began in October 1933, the Communists suddenly changed their strategy. By October 1934 the Communist had suffered heavy losses and were driven into a small area in Jiangxi.

On the brink of defeat, the Communists decided to retreat from Kiangsi (now Jiangxi) province and march north to Shansi (Shanxi) province. (see Long March)