This article analyzes the understudied novel Xin zhangui zhuan (A New Tale of Killing Ghosts, 1926) by the renowned Republican Chinese novelist Zhang Henshui (1895-1967). The main concern is the novel’s fantastical portrayal of ghosts for a practical aim. In this ghostly allegory, Zhang Henshui employs narrative intrusion and personification to satirize society, notably human shortcomings. While the ghosts expose poor morality, Zhong Kui is the representative of a rectifying force, who tries to maintain the principal order in the story as the ghosts are finally punished. For didactic purposes, Zhang Henshui also develops a narrative technique that he picks up from Liu Zhang’s Zhangui zhuan (A Tale of Killing Ghosts, 1701), namely the literalization of critical idioms. Rather than educate the reader on ethical principles via straightforward verdicts, Zhang Henshui cares more about how his messages reach the reader than about embracing didacticism. In this sense, idiom literalization generates dramatic performativity and enhances the communicative effect.