After adopting Open & Reform policy in 1978, China has promoted the introduction of new technologies and policies for development of technologies and has legislated various acts for the purpose of socialist economic development. Amid these changes for the past years, due to international trends of protection of intellectual property rights and requests for protection of trade secrets from countries that have been investing capital and technologies in China, awareness for the necessity of protecting technological or managerial trade secrets has elevated in China. Due to the domestic and overseas request for protection of trade secrets, Anti-Unfair Competition Act was legislated and enacted on December 1, 1993. Based on the provisions related to unfair competition of Convention of Paris for the Protection of Industrial Property, this law was enacted in order to foster healthy development of socialist market economy and to protect rights and interests of businesses as well as of consumers; and this law defines concept of trade secrets, the subjects to be protected and conditions, acts of violating the law, etc. and recognizes civil remedies and administrative remedies, the key content of which is compensation for damages due to violation of trade secrets. Although this law is not specialized for the protection of intellectual property rights, the protection of intellectual property rights is a core part of the law. However, many problems have variously occurred in interpreting and applying Anti-Unfair Competition Act because of political and economic circumstances of China and problems in execution of the law. Accordingly, in order to establish consistent application standard of laws by specifically clarifying application standard of laws in detail, to protect related intellectual property rights, and maintaining fair market competition order, the Supreme People's Court promulgated "Interpretation of the Supreme People's Court on Some Issues Concerning the Application of Law in the Trial of Civil Cases Involving Unfair Competition" on February 1, 2007 and has enforced it since then This paper aims to delve into the operation of trade secret protection system and interpretation of unfair competition by focusing on the codes of Anti-Unfair Competition Act of China.