Abstract: The spirit of Confucian ethics is virtually the ethical footnote of the feudal political system and natural economy in old China. Stressing justice instead of benefit, stressing peace instead of struggle, stressing virtues instead of laws, stressing collectivity instead of selfishness and a hierarchy of social stratums, all of these are virtually by-products of natural economy and the integrity of family-state. These have their limitations. Only through a creative transformation of the Confucian ethics and infilteration of the time-spirit could it meet the need of the socialist market economy in contemperary China. The creative transformation involves the combination of justice and benefit, stressing competition, collectrivity and selfishness, and equality and freedom.