Abstract: In 1920s to 1930s, Chinese grasscloth handicraft industry has declined gradually. One important reason is the loss the Korea market step by step.During that time, the crisis of exporting grasscloth to Korea and the grasscloth handicraft industry decline is complementary to each other.From the begining of 1920s,Japan has increased the import tariffs of Chinese grasscloth gradually,implementing the policy of replacing importing Chinese grasscloth by machine industry products,such as rayon.The advantage of the low cost and price of the grasscloth disappeared totally. Gradually expelled from the Korea market nearly in ten years,Chinese grasscloth handicraft industry fell into despair before Anti-Japanese war.Besides,lacking of adequate Supervision from chinese government,cutting corners , doping and cheating etc during producing and selling in grasscloth industry is further exacerbating the decline of grasscloth handicraft industry.After Japan launched an all-out war against China,Chinese grasscloth handicraft industry never recovered.

Key Words: Grasscloth; Handicraft Industry; Machine Industry