This paper analyze the conditions for the development of TVEs and its structural characteristics until the mid-1990s. The purpose of this paper is summarized in three points:First of all, Is TVEs’ development in rural China is spontaneous as the conventional notion says?;Second, what is the institutional and historical conditions for the development of TVEs? Third, what is the structural features of TVEs? TVEs could be developed on the basis specific institutional conditions and historical and social environments of reform era China. The rise and development of TVEs in rural China due to institutional change like decisions or regulations framework initiated by CCP and the relevant government ministries. In addition, there are the development socialist land system, the demolition of People's Commune system and expansion of autonomy of farmers, huge agricultural country as a developing countries, urban-rural separation institution etc. at the back of the TVEs development. However the number of individual companies, which did not exist by 1984, occupied an absolute weight in numbers since 1984. Therefore it is difficult to say that the development of TVEs was spontaneous. Then, the core difference between TVEs and other kind enterprises in China is not in spontaneity, kind of industry or ownership systems, but in rural location and farmers ownership. Structural features of TVEs is summarized thus. First, in terms of industrial structure, the weight of industrial enterprises among TVEs occupied the biggist portion from 1978 until the mid-1990s. Second, the TVEs’ ownership structure in relatively complex. Individual firms did not exist by when the Constitution recognized the legal position of them in 1984. the number of Individual firms expanded rapidly and became to the largest part of the TVEs in early 1990s. Third, the average size of township enterprises was very small. Average number of employees of 54% of the TVEs, was only 3, especially average number of employees of the private transport company's was 1.7. It was hard for TVEs born in a special environment to adapt the new market environment due to their structural specially-born characteristic since the mid-1990s. During long recession and restructuring process, most of the TVEs were selected since the mid-1990s. However, TVEs, which could secure the competitive advantage through innovation, evolved into the medium-strong enterprises or conglomerate.