Municipal planning for a capital city is not easy. As from the 1950s, several construction plans were formulated for Beijing. Dong Guangqi, a senior architect and former vice president of the Beijing Municipal City Planning and Design Institute, has been involved in general municipal and phased planning since the 1950s. The first group of planners included a few specialists that had returned from overseas, and Soviet experts who had participated in the planning of Moscow. The great majority, however, were young university graduates.

In the early stages of new China, there was high number of unemployed among the capital's residents, sorely in need of the means to make a living. The initial plan, therefore, was to make Beijing into not only a political and cultural center, but also a large industrial city. This tendency towards industrial development of the capital was a result of Soviet influence, and for the 30 years that followed, Beijing developed a strong industrial base, one aspect of which was an iron and steel works with an annual output of over 10 million tons. Excessive industrial development in the city proper, however, put great pressure on energy, water and land resources, and also on transportation, which made it very difficult for Beijing to fulfill its traditional role as the political and cultural center of China. Technological development also resulted in tall buildings that marred the flat, open perspective of the old city. New buildings outnumbered old, and preservation of the old city became a topic of increasing prominence.

Then, in 1983, Beijing formulated a city plan that superseded the previous one, and that clearly defined Beijing as the national center of politics, culture and international exchange. The plan carefully avoided defining Beijing as an economic center, instead emphasizing the need to preserve the ancient city and Beijing's status as a famous historic and cultural site.

In October 1993, a trans-century plan was formulated. Unlike previous plans, whose perspective was limited to within the 20th century, this had a vision that extended beyond and led to the development plan for 2010. More important, the new plan set a precedent by subjecting the orientation of municipal construction to the requirements of the market economy. Huang Yan explained that the plan reflected two strategic changes: a shift from simple outward expansion to adjustment and transformation of the city proper, and from emphasis on construction in the city proper to suburban areas.

As a result of these plans, Beijing now has formed several functioning areas around Tian'anmen Square. At the center is an administration area, to the east a textile industrial area, and to the southeast a chemical industrial and manufacturing area. In the west is the iron and steel and heavy chemical industrial area, in the northeast an electronic industrial area, while in the northwest, around Zhonggancun, is a cultural and educational area.