This study looks at Nationalist China's war on smuggling from 1927 to 1949 to explore the transformation of state authority and the larger socioeconomic impact of state-building. The recovery of tariff autonomy in the late 1920s empowered the Nationalist government to raise duties on foreign goods for the first time in nine decades. Higher tariffs and stricter controls on trade provided the new state critical revenues to meet an array of urgent domestic needs and foreign threats, but they also created a full-blown smuggling epidemic by making smuggling a very profitable enterprise. To meet this challenge to its authority, the state fought back with an extensive campaign to stamp out smuggling, created new definitions of legal trade, and asserted its prerogative to police borders. This study argues that the suppression of smuggling was more than a law enforcement issue: it was integral to broader state efforts to extract fiscal resources, broadcast central authority, and delineate new boundaries of legality. Merchants and other smugglers, meanwhile, did not passively accept growing state strictures but adopted a range of responses, from compliance to evasion, that helped shape the contours of an emerging legal regime. How the state asserted its prerogative to tax, regulate, and police trade--and how mercantile circles responded to this expansion of state power--are questions at the core this study. Using diverse sources such as customs records, legal cases, government correspondences, and popular press reports from ports along coastal China, this study chronicles both the campaign to fight smuggling from the top, as well as the range of reactions to official efforts from the bottom. In addition to issues in Chinese studies, I also engage with wider research in legal and economic history in examining the creation and enforcement of new legal categories as well as strategies merchants employed in response to changing business environments.