The concepts of “Da Yitong” (Grand Unification) and “Tianxia” (All under the Heaven) embodied in the tributary system in ancient East Asia actually hindered ancient China from properly understanding the outside world. This system, or the “Hua-Yi” (Chinese-Barbarian) order, was not based on genuine equality, neither was it always established or maintained through peaceful means. The central imperial government never gave up its use or threat of force against those who challenged this order, which completely ran against the ideas of contemporary international law. The tributary system had a strong inward-looking orientation and constituted an instrument for the imperial government to showcase its legitimacy and authority. The government attempted to display power, to play up peace and stability, and to feed vanity through the pomp and circumstance of “Wan Bang Lai Chao” (tribute by ten thousand countries). Meanwhile, it also imposed strict restrictions upon overseas trade and even rigorously carried out a ban on maritime trade, which destroyed the achievements by Chinese maritime businessmen and to a great extent resulted in China’s losing awareness and capacity of competition when the Age of Discovery was dawning. An obvious gap existed between the theory and practice of the tributary system, so its implications for China’s contemporary foreign relations should not be overstated.