In China, as in other parts of the world, the perceived mal-manifestations of globalization have led to the rise of anti-globalization movement among intellectuals. The purpose of this paper is to examine whether globalization is linked to social conflict in China, as perceived by the anti-globalists. It argues that globalization per se does not lead to social conflict, and the state functions as an intervening variable between globalization and social conflict. The Chinese state has played a proactive role in promoting globalization, and introduced various reform programs to integrate the country with the rest of the world. These reforms have benefited China. Nevertheless, while the state has been successful in implementing “external reforms,” it has not been able (or failed) to initiate and implement “internal reforms.” The gap between “external reform” and “internal reform” has made it difficult for China to cope with some of the “negative effects” of globalization, thus leading to the rise of social conflict.