The examination on Smith's ideological background is needed to understand his educational thought. In his ideological background, there are liberalism respecting human life and the Stoic school. He pursuits the balancing welfare between a person and society. At the same time, he limits personal gains to be no better than social gains. His principle of market competition is not the artificial competition to repress human but the natural competition to consider human and society. His principle for human is based on the following four rules, that is naturality, fairness, propriety and publicness. These ideological background play important connection parts to understand Smith's educational thought. In his educational thought, he seeks education omnipotence, altruistic human, social fairness and naturalism education and suggests public education, common education and compulsory education and emphasizes educational meritocracy competition and teachers' free competition based on abilities. His educational thought pursuits the education for human and the education for public virtue. But his educational thought is so sensitive that may be understood against his intention. In other words, his thoughts tend to misinterpret a educational natural competition principle as a artificial limitless competition principle, pure meritocracy as formal meritocracy and education providers, teachers' competition as education consumers, students' competition. These erroneous interpretations changes the natural competition for human into the artificial competition to repress human. These points result from depending excessively on the external logics without the close examination on Smith's thought. So, it is required the careful concern and prudent approach to understand precisely Smith's educational thought.