The Rural Enterprise, one of the main forces that pushes the modernization of Mainland China's countries, displays a more positive image in the name of Small and Medium Enterprise in the twenty-first century. In confronting various problems occurred nowadays in the development of Small and Medium Enterprise, a retrospect of the development of Rural Enterprise could still provide us its practical meanings.Five stages will be narrated based on several crucial events that have great importance on the development of the Rural Enterprise. Stage 1: from Village Handicrafts to Commune and Brigade-Run Enterprise; Stage 2: Step-Out and Adjustment; Stage 3: the First Take-Off; Stage 4: Harnessing and Reorganization; Stage 5: Take-Off Again and the Reform of Property Rights. From these changes we learn that even though the exterior environment was not favorable, this prevented Rural Enterprise from the difficulties in management that National Enterprise encountered and eventually brought its outstanding competitiveness in the market.