After a review of the main academic research and perspectives on social enterprises both in China and abroad, a framework for understanding social enterprises is offered in summary. The framework has two dimensions: the social enterprise phenomenon and social enterprises’ characteristics. We also adopt three angles ‐ the public interest, markets, and culture ‐ from which to observe them. And we analyze them on four levels: market practices, public-interest innovations, policy support, and ideals and values. Upon these foundations, social enterprises can be defined as a form of enterprise somewhere between public-interest and for-profit enterprises, a product of the organic combination of the public interest and the market economy, and a kind of social organization combining properties and characteristics of NPOs and enterprises. As they develop, social enterprises in China have formed their own characteristics and specific models.