The research on Chinese “de” nominal group has a long history while the study on independent “de” nominal group is still lack of depth. This paper, from the perspective of functional linguistics, analyzes the function and meaning of “de” nominal group. From the study, the paper proposes that some “de” nominal groups are modifiers with their heads omitted; the others are nominals serving as a cohesive device — reference. “De”, as a marker of nominalization, refers to an abstract thing while “de” nominal groups derive their meaning by means of reference to the dynamic context.